refi, first mortgage???? What Are my options??

Question

Hypothetically speaking.....I obtain private funds to acquire a property and make repairs and improvements. Improvements are complete and a tenant is placed with 6 months of acquisition. I am obligated to pay my private money lender the principal plus 10% interest 1 year after purchase. My credit is shot. What are my options? Is 10% fair? Can i obtain a first mortgage. If i can not obtain a mortgage personally can my company as an LLC have a mortgage in its name?Please!!!! I need help

Jerry Padilla · Answer

@Taurice Cooper if you negotiated and paid off your collections you could probably qualify, as long as you start paying on your student loans. Many times debt collectors will agree to less money. You only need a 620 to qualify for the first 4 mortgages.

Taurice Cooper · Answer

Would you consider venturing into other markets

Taurice Cooper · Answer

My credit is in the low 600's

Taurice Cooper · Answer

Thanks at  @Jerry Padilla. While i have no foreclosures  i do have a student loan that's delinquent and collections in the mid 20,000. thinks for the information.

Jerry Padilla · Answer

@Taurice Cooper

It is hard to say without knowing what you mean by "shot". If your credit score is low.... There are things you can do to increase it....You need at least a 620 credit score for conventional.

A few examples:

• pay off collections and judgements, with an agreement that they will remove from your credit score
• make payments on time
• pay down debt

If you have a foreclosure, you will not get conventional financing for 7 years.

If you have a bankruptcy, you have to wait 3 years from discharge for conventional.

If you have credit issues, you may still be able to qualify for an FHA mortgage, which requires a 600 credit score. I hope this helps.

10% for private money is a great rate. Many are 12%-16% that I work with.

Neil Aggarwal · Answer

If your credit is bad, you will probably have to stick to private or hard money. For that, 10% is reasonable, depending if you have to pay points.

Taurice Cooper · Answer

Thanks @Sharad M

Sharad M. · Answer

Hi @Taurice Cooper

I would start with speaking with a mortgage broker or couple of local banks to see what your financing options are. Private money or Hard Money can get very expensive if you don't refinance out of those loans. 10% is a reasonable interest rate, IMO.

It will be almost impossible to get a loan in LLC name without any personal guarantee. Even the LLC name will depend on your personal credit.

Good luck!