All Forum Posts by: Tom S.

@Frank Harrington  Definitely do longer than 6 months for the seller financing part.  Otherwise you could put a lot of money into it, and potentially lose the property.

I did 6 months on one of my first SF deals as a buyer, it goes by quickly!  Permits, contractor delays, inspections, starting the refi process.  It adds up.

As posted above, almost no seller will do 100% financing.

@Charise Manuel Personally, I've used local banks for deals like this (where I've held them for rent, not flipping them), speak to the commercial lending department. They loaned purchase and/or rehab funds, subject to the ARV appraisal they did, and estimated rents.

The rehab loan converted to a commercial mortgage after, no need to refinance after the rehab, so saved closing costs too.

Needed good credit, cash reserves, and a personal guarantee on the loan.

@LaQuinnUnique M.  Why not just sell it outright?  Any particular reason?

@Jay Hurst  Yes, that's why it was commercial loan, and it was on the closing statement.  And lots of other moving parts that had to come into place: existing relationship with the lender (other loans, savings accounts), great credit, great deal, existing cash reserves.  

@Heidi Christensen  Yes, combining seller financing with a bank loan.  5% down, 15% seller financing and 80% bank loan.

Key points: had to be a commercial loan, this won't work with conventional lending.  And I had to put down the 20% first, and then executed the 15% seller financing after the close, essentially reimbursing me.

@Nicholas A.  As mentioned above, I don't see any rates in mid 5's for investment properties currently.  But let us know otherwise.

Be sure take into account all costs.  Yes, you'll get more cash flow from another property, but if the refinance costs you $5-8k for example, an extra $300 in CF monthly would still take a while for break even.

@Ruben Goodbear Anders  Did you end up finding a lender?  It was about a month ago you mentioned you were under contract in your original post.

As Bryon stated just above, I've also had success in the 5%, 15% seller finance, 80% 1st lender combination.  Commercial loans only.

@Victoria Spagnolo  My quick math shows it would have to appraise around $260k to refinance it and pay off the $50k.  $260k and if the lender finances 75% of that = $195k, which is still a tad short of the $150k (1st existing loan) + $50k.  Plus closing costs.

To know for sure, you'll have to get it appraised.   

@Sean Burns Agree with William's post above, I would use that as a last resort. Is using a HELOC from your existing home for the downpayment for the next place an option? Many people go that approach to get started.

@Curt S.  I find many agents call for the first conversation to discuss in detail you and what you're looking for, then email or text after that.

They probably also want to verify the number isn't just an automated "bot" so they're not wasting their time.