I am looking for some help to obtain a property. The property has a FMV of 1 million and the seller has agreed to sell for 850k. They have an existing mortgage of 688k with no other liens on the property. The seller has agreed to work do some creative financing but due to the mortgage I know my options are limited. The property has 2 structures on it with 3 units that rent for 4800/ month and I plan on living in one unit and using the income from the other units to qualify for the property.
My main thought is to find a 6 month private money loan to clear the existing mortgage and then have her carry the balance in the form of a note. In six months I could use the equity in the house and pull a loan.
Would appreciate any thoughts or suggestions
Why don't you to a wrap mortgage, keeping the first, create a second mortgage as a wrap as a seller finance deal for one year or so. Then when you are ready refinance the entire package. Or just keep the wrap going.
@Mike Sedlacek how would I structure that? I have never done a wrap. Also I am trying to do something fast as they were in escrow for almost 6 months and it fell out so they are eager to get the property sold. That is another reason I was trying to find a way to clear their existing mortgage. And so I could leverage the built in equity to keep my cash in the deal minimum .
Thank you for you time and help
Any chance their current loan is assumable?
@Steve S. I just asked and she is going to find out if it is
Well you should hope it is. If it is then you can assume it if you qualify for a fee. Then get a seller carry back and take it over pretty easily. Assumptions still take time so just be ready for that if it is.