Bank loan on a 75k property or less, is it possible?
I have notice that many (majority) banks don’t like to lend on a property less than 75k. If that’s the case what happens to those that try to purchase properties that are less than 75k? For example in markets like: Detroit, South Carolina or Alabama?
Thanks,
@Joel Gierbolini
I have 3 mortgages under 75k. My first purchase was 70k with a 56k mortgage. An that’s in a market with a median price of 820k. If they do it here, they’ll do it where the median price is 200k. Just gotta call all of them, particularly the small local banks and CUs
My experience is to contact the local credit unions near the property and ask for the commercial lending division (if the property is titled in an LLC, even if the property type itself is a residential property).
Although they may require that you become a "member" and open up a checking account with $5.00, they often do not have minimum loan amounts, keep these loans in-house and are eager to support the community.
Additionally they often have lower FICO requirements of the loan guarantors. I have found the local credit unions to be an awesome resource. Just make sure you are working with the commercial department, not the residential department.
@Joel Gierbolini YES, do them all the time in Cleveland, ,
Good luck
I was qualified for a loan from Fifth Third Bank and they are even willing to loan me below 50k on a fixed 30yr loan @5.65%
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As an FYI, everyone should keep in mind that for properties that are below 50K you will get a lot of push back from realtors and lenders here on BP. I reached out to lots of them and got stiffarmed. I can't say I completely blame them because it can be a lot of work for them for VERY little commision so I understand that. Please keep this in mind. I actually found an agent by simply searching for duplexes for sale in the zip codes AND price ranges of what I wanted....and that's where I found the agents. Those agents will also know the PMs that will work in those areas because not all PMs will work in certain areas.
@Joel Gierbolini I was able to secure two loan through Well Fargo. One for 75k and the other for 70K. They are out there.
Just to add to what I posted earlier about my $60k loan through BB&T, they are requiring me to have HO3 insurance policy on the home, but it is proving difficult to find someone to underwrite because it does not have central heat. Just another thing to look out for, I'm a week from closing and I am scrambling to find someone to underwrite my insurance.
Northwest Bank. I was having the same issue and just received the prequalification. They do go as low as $30k. Now on to find properties in the Cleveland market!
@Joel Gierbolini no 15 years. I've always been asked this, so let me ask you. "why do you want a 30 year note?" Why do you want to pay double the interest?
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#5 All Forums Contributor
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Originally posted by @Martin Moran:
Northwest Bank. I was having the same issue and just received the prequalification. They do go as low as $30k. Now on to find properties in the Cleveland market!
Tons of inventory in the $75k or less range. Although pickens' are pretty slim once you get down to the $30k range these days.......Not like it was it 15' ohhh man we were scoping up stupid deals back then.
@Alyssa Dyer would you be able to share the info for your contact that goes below $60k? Is Illinois included in one of the 26 states?
@Hanah Frickers I'll find out!
