Lenders who allow current seller to be in second position

Charlotte, North Carolina
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Lenders who allow current seller to be in second position

Edward Moore
Flipper/Rehabber · Member since 2019 · 45 posts · 10 votes

Hey all,

Does anyone know of any lenders in the Charlotte area who allow the seller to be in second position on a loan for a rental property? To use as collateral for the down payment. 


Thank you!

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    5y

    most organized lending outfits that are in the business wont allow this but you never know..  maybe if you have substantial equity in something else that you can use as a cross..  

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  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    5y

    If you want a conventional loan with low rates, no you have to come in with the cash to close for down payment. There are other loan products that may allow for ten percent down that are not sold to Fannie/Freddie. Can you qualify with IRS taxes and assets? Can you show 24 months deposits of income instead of the IRS returns? Or will the subject Debt Service itself? 

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  • Edward Moore
    OP
    Flipper/Rehabber · Member since 2019 · 45 posts · 10 votes
    5y

    Thank both of you for your responses. 

    @Caroline Gerardo No, we cannot qualify from what I understand. But, we will keep looking. 

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  • Moshik Zemach
    Developer · Charlotte, NC · Member since 2021 · 19 posts · 9 votes
    5y

    Hi Ed.   Is the seller will be also guaranteeing the loan?  Or the seller would be giving a second mortgage to you using the second lien position?

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  • Edward Moore
    OP
    Flipper/Rehabber · Member since 2019 · 45 posts · 10 votes
    5y

    @Moshik Zemach The seller would not be guaranteeing the loan. 

    I think I worded my question incorrectly. We are looking for a lender to be in first position, with the owner carrying part of the down payment or even the whole 20-25% the lender would need. The owner will be in second position. 

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  • Moshik Zemach
    Developer · Charlotte, NC · Member since 2021 · 19 posts · 9 votes
    5y

    I might have a credit union lender in the area that will do that for you.  Just PMed you

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  • Caroline Gerardo
    Lender · Washington DC · Member since 2015 · 2k+ posts · 2k+ votes
    5y

    @Edward Moore can you qualify with bank statement deposits over past 24 or 12? Can the subject property cash flow after PITI? Do you have assets we could extrapolate income there from??? All these are other methods to close loans

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  • Edward Moore
    OP
    Flipper/Rehabber · Member since 2019 · 45 posts · 10 votes
    5y

    @Caroline Gerardo No, we cannot show bank statements for the required amount of time.

    I should have also mentioned that this is a portfolio of 40 single family homes. Not one single property.

    The numbers do look good as far as cash flow.

    And no, we do not have any equity to pull out of another property at this time. 

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  • Shawn Krieger
    Member since 2019 · 151 posts · 20 votes
    2y
    Quote from @Moshik Zemach:

    I might have a credit union lender in the area that will do that for you.  Just PMed you


     is this still available

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