Financing (Seasoned Funds)

4 Replies

When trying to obtain financing for an investment property , how do you get around not having seasoned funds in your account.

what are you trying to accomplish?

@Stefano Mannino

there is no "workaround" for the seasoning requirements. However if you were cash rich and didn't trust the banking system (like some people) and wanted to get traditional financing but also had the "cash" necessary for a purchase. Then make sure to have the funds in the account 2 months prior to looking for a property and getting it in contract. Also avoid any deposits over 10k otherwise you'll have to source the funds and explain where the money came from (if still within the 2 months period), but if you wait 3 months then you'll be fine.

Deposit the money into the account the month before the lenders seasoning requirement - for example, they want 2 months banks statements - you need to deposit the money 90 days out. So the workaround is to season the funds.

Originally posted by @Stefano Mannino :

When trying to obtain financing for an investment property , how do you get around not having seasoned funds in your account.

 Ya know how people say you "can't" use borrowed funds for the down payment? But people use HELOCs all the time, which is clearly borrowed funds, so we know that's not the whole story.

The full story is that you can use secured borrowed funds, no seasoning, no hiding, nothing. Your partner can lend you the money, secured by some other real estate as a notarized/recorded official second mortgage to whatever LTV you wish (incl >100% CLTV).

- Loop in a RE lawyer if it's your first time.

- DTI still has to work. They called me a smart alec when I tried to do 0% to the rate and interest only payments (do the math on that one :P ), so now I do 5% i/o.

- No/minimal overlays investor friendly lender will be required. 

- Mortgage lenders are not expected to source where they got their money from, so your partner's money can come from basically anywhere. Your partner / private mortgage lender also is not the borrower to the main lender, so none of the PATRIOT Act stuff applies. 

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