45 days to release funds after the offer…..to long?

[Anthony Bonanno]

I met with a local credit union today and they would do a loan 90% of purchase price and rehab costs or 75% of ARV, whichever is lower. I would need skin in of 10%. Interest rate 5.5%-6%. In addition to any purchase, holding, and closing costs I would incur, that scenario would work within my financing strategy. It would take 45 days to release the funds. I will be making offers on HUD and REO properties for buy and flips. Is payment in 45 days to long for those types of properties versus cash offers? Would the offer be viewed unfavorably vs. the cash buyers?

[J Scott]

In terms of rehab financing, those terms are fantastic. Better than I've seen in a couple years.

That said, it's going to make working with REO and HUD properties a bit more difficult. You won't be able to submit cash offers, and you'll need to ask for about 8 weeks to close with your financing -- this isn't going to be attractive compared to cash or quick financing terms.

Can the credit union do a cash-out refi in 45 days if you can buy the property for cash beforehand? If so, can you pull together enough cash to buy it before the credit union can fund it, for a couple weeks?