Double Close Help
I recently found a property in lis pendens and the seller and i put it under contract for the pay off price. What I would like to do is have my company then buy that so I made a contract between me and the company for a higher price to get some equity out of it and move a renter in.
Will banks have a problem with this and what is the best way to do something like this?
Thank you for any advice.
Couple of problems I see. 1st you will run into title seasoning issues, most lenders nowadays require 6-12 month seasoning of title and will use the lower of purchase price or appraised value. If you do find a lender that doesn't have seasoning issues, they will most likely not lend to a company or require a personal guarantee from the owner. So if you personally guarantee the loan, they will see that you are basically selling to yourself and will not allow. You can get a commercial loan to buy under the company name but commercial lenders only lend up to 80% ltv, so your company will have to come up w/ 20% down, kinda defeats the point of selling to access equity.
You are better off just trying to find a lender with no seasoning issue so you can refi using appraised value and access equity. Be difficult to find but they're out there.