30% down!
I'm wanting to buy another property, but because I am now not working, the banks want us to put 30% down on the property we are looking at buying. We have plenty of liquid assets, why would they need so much cash? And is this going to happen everytime we decide to buy another property?
Go talk to other lenders. Perhaps you have a situation on your credit that is causing this.
Also, ask your lender why you have to put 30% down.
Remember, things like this are negotiable. If you don't like their terms, there is certainly more than one bank in the US.
If you have decent credit and liquid assets you can get by with much less down.
Your bank, more often than not, is going to be your most conservative, restrictive, expensive lender with the most red tape. Look for lenders that do one or more of the following things:
-75% or higher LTV (there are a number)
-People who will go off of appraised price rather than selling price (also a rare breed but they're out there).
-Unseasoned Down payments (come in with a line of credit from a home equity line of credit, unsecured LOC, etc.)
-unseasoned refinance (usually 70-80% LTV, and often lower rates)
-Structure the purchase so that 75% LTV to the bank works out to be a much higher LTV to you (e.g. the seller carries back 10% which is later forgivin).
-Look for lenders that allow high CTLV loans (e.g. 75% from them with a 25% seller carryback).
-Lease option the property from the seller, where all options/leases go towards the down payment if it is excercised
-find a private investor and give them a return or and equity split
-do an equity split with the seller
-Use a credit card cash advance and keep jumping it to other cards that are "0% APR for balance transfers for 1 year"
-Get a loan with your stock portfolio as collateral (yes, they're out there)
-Use 20% hard money, fix it up, raise rents (and value) and refinance in 3-12 months (80% ltv or so).
There are probably more ways, but those are the ones that are coming to mind right now. Remember, No money down means none of YOUR money down. Even if it comes off of your visa, it's still not your money (although it may feel like it).
I'm slow to recommend this book, but it did have some creative ideas. "how to make millions in RE in 3 years starting with no cash" by Tyler Hicks. He's overly optimistic and simplistic, and trys to sell you on his products throughout. That said, I think he had some great innovative ideas for financing properties. Take it with a grain of salt. (for example: he'll claim that a properties Gross income is your cash flow and put "after expenses" in the fine print. There's a big difference between GSI and CF).
There is a difference between "Real Estate Investing" (what banks do) and "CREATIVE Real estate investing (what we do). You won't hear any of these ideas from your banker. Good luck.
Your lender is probably requiring at least 30% down because they believe that since you have no job (and no wage income) you will only qualify for a "no income qualifier" loan.
As the other posters have indicated, shop around. There are a few 100% financing investor loans out there.
Taxjunkie
Thank you all for your advise. I am working on getting our credit rating improved and am on a standstill for the next 30 days or so. But after that I will contact more lenders to see what they have to say. Thanks again for the encouragment.