First Deal And Need Advice
Can someone please give me advice on how I can proceed with this deal. I'm very discouraged, I've been trying to invest for a year and now that I have a property under contract I cannot get financed. I'm scheduled to close on 5/24/04
Single Family
Purchase Price: $40,000
Repairs: $15,000
ARV: $99,000 - $105,000
I was pre-approved with a hard money lender in January. At which time my FICO Score was 630 and I had money in the bank, since then my score has dropped and I've had to spend my savings.
This lender is giving me the run around. Last month, I didn't need a downpayment, then it changed to 5% and now two weeks before closing I need 10% which I don't have. I don't want to lose out on this deal but I have not been able to find another hard money lender.
Yaisa Hagood
Find a private lender, immediately. Any lender that wont stand behind his offer is someone you dont want to business with. If the lender made you an offer, read through it to see if you can hold him to it. If he hasnt done so in writing, then you need to make sure the next one does.
You could also try to sell it before it closes with the repairs to be done. If you are able to sell it, then get the down payment you need and close the deal. Make sure that the deposit is non refundable so that you can spend it. You could lease to own with that option as well. You could also wholesale it out or partner with a private investor who has the cash you need. The amount you are asking for is smaller so a private investor will have that. But it is smaller than the average mortgage broker will deal with as it is under the 50K mark. Tough deal to get financed, through normal channels given the smaller amount. Dont forget to advertise it here on this site as well and dont be greedy. Offer it for one price fixed up and offer another price for wholesaleing it out. I would also use your local newspapers and secondary flyers. In florida I get a better response through the thrifty nickel and pennysavers than the local Tampa tribune.
Also if your credit has faltered, make sure it isnt because the mortgage broker ran your credit a number of times to do the deal. If so I would throw it in there face and have them take care of it or honor there original offer if they are the cause of your credit problems. Since you dont have what it takes to get the deal done with the lender, I would get tough with them as you have nothing to lose. Its crunch time, so time to get in high gear.
Good Luck,
Kyle