Flip Financing-title Seasoning Problems From Buyer 's Lender
Just wondering whether anyone out there has had any experiences good or bad on the back end financing of their retail homebuyers.
I mean after you the investor bought a property,and quickly (within 1 or 2 months) found a first time home buyer who signs a contract to buy it from you.
I am trying to get a feel for if any of these deals where either rejected by the lenders with the reason being that the seller was only on title for 1 or 2 months.
I know a lot of the lenders are requiring a 24 month chain of title, and asking the appraisers to comment about recent sale of the subject property. I have heard that some of them question how much profit is beign made on a flip.
They want you to justify your profit with
evidence of improvements, and even then can still come back and say that they think your profit is unreasonable for such a short period. I know it sounds crazy, but I have heard these stories from investors.
1) I am very curious to know which banks/lenders approved the deals quickly without title hassles, and which ones gave them major problems.
2) Has anyone done a recent flip where the eventual buyer financed with an FHA loan?
To me these are important considerations, and was wondering if any of you could share some actual recent experiences.
i am new to this site and was browsing some posts and came across yours...did you ever get an answer? I have concerns with this myself.....
These lenders are ridiculous. Question: are you having this problem with FHA, perhaps they are overly gun shy.
Also, I imagine if you networked with an aggressive and creative mortgage broker (are you one?) who works with 50-150 lenders, but is still based locally or regionally, they could quickly find programs that have good rates, but can avoid the massive amount of B.S. that these lenders are throwing up at investors.
Hope this helps, Dave
I am a broker, and I have found a couple of local lenders who claim to not have any seasoning requirements, but I am not yet convinced. Howeveer, I was hoping to find out what other lenders are out there. I was hoping to get a list going here that could benefit all of us.
The lack of response seems to confirm there is a lack of such lenders.
I've been told and it has been my experience that as long as you keep detailed documentation to what you did to the house then you typically don't have a problem. A photo speaks a thousand words---especially a before, during, and after!
I also work for a mortgage broker.
Here are two that I have found that don't have any seasoning issues:
First Alliance Bank (Jacksonville, FL)
Commercial Federal Bank (Omaha, NE)
I'm signed up with both, if anyone has any immediate needs, let me know, I can get a loan done for you.
Good luck,
I work for the big 4 and I believe the policy is 12months vested interest. I wouldnt get a loan from them if I was flipping property.
Try to go conventional first. There are a lot of look a like FHA programs.
What I am doing now is taking pictures
before and after and keeping good documentation. I then put in the MLS comments that the buyer has to go conventional. If the house does not sell within the 90 day period I first own it, then I take off that requirement.
There is no rhyme or reason, some underwriters don't require anything and others want to know everything.
Best Riches,
Jeff Adam
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