Long story short, I am currently in contract for an investment unit in Jersey City, NJ. The unit is in a solid location and great cash flow producing opportunities. The seller's agent did not disclose this information at the beginning, but the unit belongs in a nonwarrantable complex, meaning I can not get conventional financing.
I have been shopping around portfolio lenders for the past few weeks but haven't been able to get a decent quote from anyone. The best option I was able to get was 40% down, at 5.125% with 3 points upfront on a 7/1 ARM, which I'm really not keen on pursuing. Here are some more specs on the unit are:
Down payment: $20k (25%)
Loan amount: $59k
Addt: 750+ FICO, stable income, etc.
If I can't find a portfolio loan, what are my other options to try to get this deal done, other than to buy it in all cash? Can I ask the seller to carry a note back? I know it's a very low amount of money, which is making things more complicated. Any help would be really appreciated, otherwise I am going to have to kill the deal.
If a buyer cannot obtain financing on a property and the seller really would like to sell the property, and the buyer still wants to buy the property, then then seller financing may be the only option. Ask the seller to finance the sale.
If you're already considering walking from the deal because you can't find a portfolio lender to lend on the property what do you have to lose? Exactly, simply walking from the deal if they say no. So ask them and see what they say.
@Christopher Telles Chris, thank you for your reply! I was considering offering the same alternative to the buyer, but didn't know if that was way off base.
Considering no banks will loan on the property, I would imagine the seller will have this problem with most future buyers as well. Thanks for the nugget, and I will keep you posted with how things go.
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