All Forum Posts by: John Stevenson

If you are looking to purchase a home for $20k, it is true that you are going to have trouble getting conventional financing. If you own another home and have any equity, you could use the equity to finance the purchase.

You can do this through either a home equity loan or a HELOC (Home Equity Line of Credit). The interest rate is a little higher than a conventional 30 year mortgage but then you do not have to borrow more than the actual price.

Lenders prefer a W-2 but they can also accept, and usually require, 3 years of tax returns and/or profit and loss statements. Lenders want to make sure your income is stable and that you will be able to make the payments. If you have proof that your consultancy income will continue, then by all means talk to your bank.

There are also other factors that come into play when applying for a loan, such as your credit history. Your credit history tells the lender whether or not you’ve been able to meet your loan and credit obligations in the past. If you have a good credit history, securing a mortgage can be easy. Poor credit history can make it more difficult.

Some lenders will allow you to refinance multiple properties into one loan. This may be a way to get around the 10 property cap but the terms will not be very attractive and you will need to have a good deal of equity.

Another option is owner financing such as purchasing properties on a land contract.

Another option is finding partners or placing properties into corporations.

You can also look into hard money lenders. This company claims to be able to make loans above the 10 property cap. I do not know anything about them, so you will have to do your due diligence. http://www.buyersutopia.com/loans-for-multiple-investment-properties.htm.

The internet is such a great resource for research that I cannot really see the benefits of using a loan agent. There are a lot of online sources for mortgage rates and terms. I personally like Bankrate.com.

Many banks now offer online applications. Applying to two or three banks should not adversely affect your credit score. Applying to 10 or more... well it will make people wonder what is going on. So, do your initial research, run the numbers, watch for points and then choose your top three and give them a call.

If conventional financing does not work out, here are a couple of other options:

Find a property to rent-to-own or lease with an option to buy. If you have a lease-option for 5 years, at the end of that time, you will need to purchase the house and can get a bank loan then. Meanwhile, you can use the time to fix your credit and/or save for a down payment. Some contracts may put some or all of the rental amount towards the down payment.

Get owner financing or a land contract. Another option is to have the seller act as the bank. You make your payments, including interest, directly to the seller. Then after usually 3 to 5 years you make a lump sum payment to the seller. During this time, you should have enough equity to qualify for a standard bank loan.

Another consideration is to determine your holding period. If you are looking for a long holding period than cash flow per unit should be your consideration.

If you are looking to resell the units in a short amount of time then consider SFR because the resale is easier, the gains can be higher and the interim rent is higher as well.

Tim Czarkowski makes a good point about financing. If you can keep your units below 4 you can get better interest rates and thus increase your cash flow.

During the short sale process, the buyer does not interact directly with the lender. Instead, the real estate agent will interact with the seller and the mortgage lender to try to close the deal. The process is still much the same as getting any other kind of financing on a regular home or foreclosure. Bank short sales follow the same kind of rules and process when it comes to getting financing.

A good place to start would be with the heirs to the property. It sounds like there are 4 heirs.

I would prepare a letter of intent and send it each of the 4 heirs to see if they are interested in selling the property. If there are tax lien investors, then they may have an interest in the property as well which will need to be addressed.

If there is any interest from the heirs in selling the property, I would recommend working through a real estate lawyer to make sure that all the bases are covered.

Once you locate the property on Google Maps, you can transfer to the county GIS website to locate the property information by finding the correct parcel. Once you find the parcel, you can pull up the information about the property including the land size and property owner.

Here are a couple of sites around Houston that can help:

http://www.hcad.org/maps/default.asp
http://www.houstoncounty.org/dept.php?id=12&page=8

I hope this helps you get the information that you need.

HUD Homes are initially offered to owner-occupant purchasers (people who are buying the home as their primary residence).

HUD does not provide direct financing to buyers of HUD Homes. Buyers must obtain financing through either their own cash reserves or a mortgage lender. While HUD does not provide direct financing for the purchase of a HUD Home, it may be possible for you to qualify for an FHA-insured mortgage to finance the purchase.

HUD does not warrant the condition of its properties and will not pay for the correction of defects or repairs. It is highly recommended to get a professional inspection before buying the home.

If you are interested in acquiring a HUD Home that is in need of repair, you may be interested in applying for an FHA 203(k) Rehabilitation Loan. The borrower can get just one mortgage loan, at a long-term fixed (or adjustable) rate, to finance both the acquisition and the rehabilitation of the property.

To buy a HUD home you need to submit a bid for the home during the offer period through your real estate agent. HUD does not deal directly with home buyers; you must have an agent. The agent delivers a sealed bid. HUD usually chooses the highest bidder.

Good luck!