Cash Back At Closing?
How do I go about getting cash back at closing? in other words, the equity upfront rolled into my loan? I am buying a duplex that appraises higher than what i am buying it for. I can use that money for fix up costs....
This is the same question I am looking to ask since I have a deal with about $40k in equity and I am looking to do the same thing. My friend is an investor and if you get the seller to go along with it, you can have the seller pay a "consultant fee" paid out of the closing, just like paying a real estate commission. This way they do not get taxed and you are sure to get your money and no license is required so it shouldn't raise any eyebrows. But make sure you talk to the title co. first but they will be fine with it. Or partner up with someone and do a simultaneous close. I am interested in what other options there are though, cause somebody's doing it.
[addsig]
one property i bought with my equity line from my house, then i did a refi on it and was able to loan only 80% of the apraised value. it was an investment property and lenders are more cautious.
some time you can do some creative finance with local to your area banks and or credit unions.
for example my credit union will loan 80% of appraised value.
keep shoping and you should find somthing
I don't like cash back at closing.
#1 all you're doing is borrowing the money, putting you in further debt. And that you have to pay it back.
#2 Unlike what you'll be told by some "guru's" it is not income.
#3 to get cash back at closing the way you are talking about, means you went out and asked the bank permission if you could be a landlord. Time to be more creative
#4 why are you getting a loan with cash back at closing in the wholesaling forum?
JB
[addsig]
JB, by closing your mind to more traditional approaches to investing you are missing alot of oppertunities. There are some good reasons to take cash back, primarily because having funds or access to funds makes the next deal. Especially if you have put alot of cash into a deal, you may want to get it back out. I now pay myself for my time, not alot, but enough to pay the bills. I know, you are all about the creative side of things, but they don't pay extra for creativity and you can find more deals when you have some $$.
Don't view traditional methods as the enemy, start thinking about utilizing financing creatively. j owley has it right on. Make a deal, rehab it, THEN go to the bank, wash rinse repeat. If you can get 1 house ahead of your financing it becomes very easy.
#1 yes it is more debt, debt that pays for it's self and more. I'm seeing rents that are double what my payments are on a fixed 15 year note. I'll take all the debt like that I can get.
#2 very true. people who think it's spending money go belly up and I buy their properties from the bank
#3 I like banks. I'm serious. Banks make me happy. Listening to someone in forclosure tell me their troubles would have me sucking on my exhaust pipe.
#4 I have NO clue LOL