Finding Funding for My 1st Duplex
I believe I have found my first deal but now I need help finding the money to pay for it before someone else gets it. Its a duplex in Tampa and the buyer is asking for 37k and its worth 72k. He said it needs about 20k done in repairs but both units are currently occupied. This property is in a really good neighborhood in Tampa and if I can purchase this property I would owner occupy the studio ($400 rent) and rent out the 1/1 ($600 rent). I've spent most of my day calling many community banks in Tampa trying to get a mortgage for this property. Most banks said the price was to low to give a loan out on and others said they couldn't give me a loan because the mortgage company would require the repairs be fixed before the loan would be given. I'm waiting on a few calls back from the other mortgage lenders , and I am also waiting to hear back from the buyer on what kind of repairs need to be done- either major or cosmetic work (which is what one of the mortgage lenders inquired about). I have not put the property under contract yet because I don't know if I will be able to acquire the funds for it, but what if I do all this work to find funding and someone ends up buying the property? What should I do, I really think this property is for me and its just the price I can afford to put at leaste 10% down on!?
Hi Aryelle,
I agree with the bank that you need to know if it is major (i.e. roof, plumbing) or minor (cosmetic) repairs, before you do anything. That way you will also find out why the owner is willing to let it go for so little compared to what it is worth. If you are willing to occupy one of the units, you could qualify for a FHA loan with 3.5% down. I would suggest you find out as much as you can about the condition of the property, cost of repairs, taxes and insurance. The last two can be found on public record. If you end up going forward, I would also suggest having an inspection done just to make sure there are no hidden issues that you may come across down the line. Good luck and hope this helps.
I would look at an FHA 203(k) Streamline loan. It would allow you to purchase with an FHA loan where property condition may preclude the standard FHA loan. Rolling in your repair costs may well get you over the minimum loan size of some lenders.
I have tried to get a FHA 203k loan but I have not been on my job for 2 years so I don't qualify for the funding. @Phil G. @Shannon Covington
In the past I used Bank of America. That's right, big ol' BofA did some of the small loans for me! The rates were higher, but with such small purchase price it didn't matter. I originally did 20yr loans to lower the risk per their request. These were loans under $75k, I am not sure about 37k though, but good luck!