Getting a loan on a foreclosure that needs a lot of work

6 Replies

So a property went up for sale in a really hot area as a foreclosure. Someone recently bought it at a Sheriff’s sale, but paid way too much for it. They got in over their head and lost it. It’s two apartment complexes with 4 units each. They want 140,000 per complex, but they need completely renovated. There is mold in a couple and they gutted a couple. In this area with the amount of work they should be priced at 60 each. If I did everything myself I’m looking at around 100,000 in renovating costs for all 8 apartments. Let’s say they except an offer may 120,000 for both. Is there a way to get a 220,000 loan so I can have renovation money?

I doubt they except 120,000 for both, but if they don’t it’s going to sit empty for a while

Depending on your situation, you might be able to get a 203K. Get creative with your offers- maybe you ask for a big discount on the price, but offer him an indefinite dividend for life- 5% of gross rents? Would that be worth it to you? You are asking for a huge discount, but there's many ways to skin a cat.

Corby Goade, Real Estate Agent
208-297-3010

I would be willing to do that but this is bank owned foreclosure.

If it is bank owned there is chance they want cash. If they do team up with someone willing to lend you the cash. If you just need help getting the property see if the person is willing to lend the cash as a loan. The first step is to see if the bank wants cash offers or they will accept financing

They will except financing but i don’t have a ton of liquid cash and I’ll have to borrow rehab money. Or at least part of it.

I’ve been doing a lot of research on hard money lending, and came across this site that breaks down the best hard money lenders of 2017. I was looking to fix and flip, but there is a company they say works well for rentals as well. Hope this helps!

https://fitsmallbusiness.com/best-hard-money-lenders/

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