I would like to learn more about a mortgage deed to rehab and sell the property later. I have $1000.00 down, whatever monthly payment as long as I get a mortgage deed.
What are the requirements? where can I find them ? Please help! Need advice!
Thanks in Advance,
No body has answered because, frankly, your question doesn't make sense. A "mortgage deed"? Perhaps you can explain what your are trying to accomplish and the BP community can help.
I've not heard the term "mortgage deed". I think you may be confusing that with "mortgage" or "deed of trust". These are essentially the same thing. Some states use one, some the other. When you borrow money and pledge a property as security for the loan, you give the lender a mortgage or deed of trust. That gives the lender a security interest in the property. That is, the mortgage or deed of trust gives them the right to foreclose if you default.
So, I think what you're really asking is how to get a loan to rehab a property. The most common sort of loan for fix and flipping is a hard money loan. Hard money lenders are expensive and usually small, local companies. Find them by talking to investors in your area.
You will likely need more than $1000 of your own cash, though. Even the most liberal lenders will typically only go to 70% of ARV. There are points and up front costs, so even if you deal is right at 70%, you'll still need cash for other costs. My rule of thumb is that if you have a 70% deal (purchase plus rehab is 70% of ARV) and your lender will give you that amount, you will need 15% of ARV in your own cash to cover the up front costs, payments, and paying for labor and materials before being reimbursed by the lender.
Many HMLs have minimum down payment requirements. You would add that to my 15% above.
Other alternatives are construction loans from a bank (rare, but not impossible), a LOC or cash out refi on another property, or a money partner. Some lenders will also do "cross collaterization" where you pledge a different property as additional security.