Rental Property Investor · Thief River Falls, MN · Member since 2020 · 5 posts · 1 vote
I currently have a house in La. that is being repaired thanks to Hurricane Ida. It's also been needing renovations for a few years now. The mortgage (Rocket) is about $87k and the Zestimate is about $167k.
I'm currently working out of state and am looking at buying an old trailer and land for about $40k.
How would I go about handling this transaction? Should I get real estate agents in both locations? Would a mortgage company do something like a transfer to the lesser value property?
In a way, I want to rent out the old house but I have enough on my plate as it is.
I'd also like to sell the house and buy the trailer with the "proceeds" but my girlfriend still needs the house to live in. I'd move her up here but the hotel I'm being housed in doesn't allow pets.
Any suggestions or article links would be helpful.
Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
4y
You can't move the mortgage. 1. Fix up the New Orleans house and get it sold.
The city where you want to buy you probably just want to purchase land that has hookups for electricity. Land is difficult for a seller to get sold fast, the seller might carry a loan of half the price for like ten years, this gives you more cash to work with.
Girlfriend has how many pets? Can a family member take the pets temporarily?
Rental Property Investor · Thief River Falls, MN · Member since 2020 · 5 posts · 1 vote
4y
She's a rescue and has separation anxiety. Same with the dog. LOL But seriously, the dog clings to her.
I talked to the seller and he's going to work with me. In a way, I'm buying the land that the trailer is on and the trailer is just a freebie since it's not worth a whole hell of a lot. Semantics I guess.
Lender · Boulder, CO · Member since 2016 · 53 posts · 21 votes
4y
Hey Gilbert,
That is definitely a doozy! Is your insurance paying out for the rehab on the property?
If it were me in your shoes, here is how I would proceed:
1. Get the property fixed up.
2. Do an owner occupied cash out refi at 80 LTV. By my calculation, you will walk away with about 40k.
3. Keep the property as a rental after you can move both of your rescues ;). This is assuming it will have the ability to cover the new mortgage and with management fees.
4. Get a bank loan for the land. These are usually 50-65% LTV, but the proceeds from the refi should easily cover this.
5. Look for a way to redeploy the left over funds to buy more real estate.
Step 5 is just me pontificating! It depends on your goals, are you looking to grow an empire or is your end goal living on this piece of land unencumbered? As a final note, if the seller is working with you....would he be interested in owner financing. It could be a win win! I.E. he can make some interest and have regular note income while you can reduce your out of pocket expense.