how to proceed with a purchase

Question

Hello...long time reader...first time poster..
I'm considering purchasing a 2 bd condo in Jersey City New Jersey and I'm looking for the best way to finance it.

I currently own a 3 family apartment building in Brooklyn NY with about  ~280k left on a 323k mortgage. The place is assessed by the city for 550k+ I'm thinking about taking a HELOC and using the money as a down payment on the condo and using some of the money to purchase a REO or a foreclosure property that should be less than 50k in an area not too far from me. What would be a reasonable amount ($ amount I can get and rate) to expect from the HELOC? My credit is great and so is my income from work....

Thoughts/advice?

Jon Holdman · Answer

Hmmm, interesting situation. I suspect most lenders would consider this investment property, and would not consider you to be actually be occupying the property, since you don't really have a "dwelling unit".  Essentially, you're just camped out in the basement.

Try calling around and seeing if you can find a lender who will do this refi.  A good, investor friendly mortgage broker would probably be helpful to your quest.

Vishal D. · Answer

yes it is. as long as there isnt a tub/kitchen...which there isnt.

Vishal D. · Answer

It's 3 units and all 3 are occupied...I renovated the basement and currently reside there. so 1st floor - 3rd floor are rented. sorry for the confusion

Jon Holdman · Answer

So, its really four units?  Is it permitted and zoned for four units?

Jon Holdman · Answer

I don't understand how it can have three units, you live in one, yet all three are rented.

This is significant because you might be able to get a HELOC if its owner occupied, but probably cannot if its tenant occupied.

Vishal D. · Answer

I do live in the unit, but all 3 of the units are rented. I've redone the basement. Ive owned it for 5 years now.

Jon Holdman · Answer

Do you live in the three family building?  You might be able to get a HELOC if you do.  If not, I don't think you'll get a HELOC at any rate or LTV.

How long have you owned it?