Can I put 0 percent down if my purchase price is .75 the appraised value

Question

Hi all,

I have found a house in Lehigh acres Florida for a purchase price e .75 of of the appraised value and it is for sure a 1 dscr.

can I immediately buy this for 0 Dollars down

Theresa Harris · Answer

I don't know of any mortgages where you can put no money down. You could put 20% down, then refinance and pull it back out...so effectively zero down.

Bob S. · Answer

NO of course not!

James Wise · Answer

If you live in it you can probably do 3.5% down. If not, you're looking at about 25% down.

Robert Ellis · Answer

I wasn't saying 0 down, but the concept of full return of capital. 15% land purchase cash. in columbus land is let's say 50k we build a triplex for 350k which is very close to 15%. small entitlements, reserves required, etc whatever lender asks for. multifamily sells for 200k per door in our market over 4 units, we are pushing the values up. first ones we are working on because of rezoning, etc but it's a full refinance on 6 month seasoning and do it again. that's the scenario that I was outlining. we do it in the urban core of Columbus where new construction trades at $325 a square foot or more for higher rents and higher equity. we could still put more units per parcel in columbus. these are all infill I hate Lehigh acres. overbuilt, no infrastructure, no commercial drivers or asset. I like land locked areas and urban markets as do most firms. look at where banks buy buildings. mostly 20 story buildings in downtown markets for a reason. asset protection and preservation so we try to do it as close as possible. there are lenders in columbus that do 100% hard money financing for renovation loans that based on experience make concessions to experience operators. we are vertically integrated though for design, build, entitlement, leasing, and brokerage so there isn't much missing. licensed general contractor.

Erik Estrada · Answer

If the property is not a total gut or vacant land I do not see how a ground up construction loan would work in this scenario @Robert Ellis, you mind walking us through this to provide some insight.

Lenders will require a downpayment. On a DSCR loan you are looking at 20-25% of the PP. If it is on fix and flip you are looking at 10-25% down depending on your experience and ARV.

If you are buying under market, you may want to look into a local hard money lender. They may be able to finance you at a low down payment if you have experience, reserves, and FICO as long as the 65% of the value can support the entire purchase price

Robert Ellis · Answer

only way is through ground up construction and refinance out with dscr. total return of capital and asset ownership. that's the only structure I've seen in Columbus Ohio or florida

Stuart Udis · Answer

@Yocheved Beer Lender's customarily will not provide credit for imputed equity for merely purchasing a property well. If the fact pattern was different and after you went under contract you created value through a variance, permitting or other means then you have a different story to tell and some lenders will treat the imputed equity as your cash consideration. However that doesn't appear to be the case with the property you are purchasing.

Jake Baker · Answer

@Yocheved Beer

Lenders typically still require 20-25% down. They will go off the purchase price or appraised value. I believe the most cost effective strategy would be to get a private loan from someone to purchase with cash. Most refinance loans have a seasoning period of 90 days to 6 months.

Can I put 0 percent down if my purchase price is .75 the appraised value

Can I put 0 percent down if my purchase price is .75 the appraised value

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