Looking for advice if anyone has had any experience with a situation like ours.
We currently own 2 properties – one primary home owned jointly by me and my husband, and one rental owned by me. The rental currently has 50% equity, which I would like to tap into for investment. The rental currently has a positive cashflow and the loan interest rate is 5.25%.
The issue I have is that I have a foreclosure on my credit report from 2012 (in my name only) with current credit score of 720 and full time job. My husband is between jobs with VA benefits. Has anyone had experience:
- 1.Either refinancing, or taking Heloc with Foreclosure on CR
- 2.Buying investment property with foreclosure on CR
- 3.If possible what interest rates should we expect for refi/HELOC/mortgage
Any input is greatly appreciated
@Prolet Miteva conventional financing will be difficult until you are outside the foreclosure for 7 years.
@Jerry Padilla - would we have other options other than hard money? Also I wonder if there is a possibility of maybe buying jointly with my husband (who does not have the foreclosure on the record) or under his name, but he does not have the income requirement...
As far as Heloc on the current property is the requirement still 7 years?
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Since you are married, I assume most lenders will look at both of you. I don't think you can buy it in only his name.
The VA benefit you husband has will allow the foreclosure and your income to qualify. The VA requires 2 years seasoning on foreclosures from the date of the new recorded deed or transfer. So, if you have enough income to make up for your husbands transition, you both can use his benefit.
Aside from that, there are portfolio products available that will give you an exception on your foreclosure. The main portfolio product I know requires 3 years seasoning from your foreclosure date/transfer. If that's the case, you can take out a max of 75% on your rental. If it's not been 3 years, the only option I know of is a portfolio that gives you 55% LTV.
It goes by each individual person. If your husband doesn't have a foreclosure in his name than he may be able to qualify, but would also need the income to qualify. As far as HELOC, I don't offer them, but they are treated the same as a mortgage, as far as I know. Some local lenders may be able to help you. It will be difficult if it is an investment property versus a primary residence that you are trying to cash out on.
@Robert Sepulveda Since it will be an investment property I do not think that VA benefits apply at all. If I am wrong would be awesome... Is the portfolio lender you know of for a heloc or purchase. For purchase I might be ok with 55%.
I will start calling some banks next week to see what might be my options (if any). I might look at portfolio landing as well right after I do the research on how to find portfolio landers :)
On our current primary home we did take out a heloc last year and it was under my husband's name with me as "supplemental income". However this was penfed and I have heard they are not into investment loans.
You're right, i was't thinking about your investment property, just your primary.
You can purchase or refinance with the portfolio on your investment property at the LTV I mentioned. it's a 5, 7 or 10 year fixed, 30 yr amortization. Minimum $300k loan amount. Unlimited cash out. Rates will be about 6 to 6.5%.
@Robert Sepulveda Thanks Robert!
definitly a few things to research. Reading through the forums I am starting to wonder also about comercial loans if I were to expand the multifamily to more than 4 units. I will have to research how my foreclosure would affect that as well and if it will have less of an affect than conventional financing.
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