Pre-construction Questions
I am a newbie investor in the Minneapolis-Saint Paul area. I am selling my first property Monday. I am interested in learning more about purchasing pre-construction properties though and I had a few questions was hoping those in this forum can help answer.
1. I know from reading the messages in this forum that its best to get in the first addition of pre-construction in a new development. But what about purchasing property in the second or third additions, as long as the property is still pre-construction?
2. Is it better to get financing for the property through the developer or find a lender on my own?
Any advice will be greatly appreciated. Thanks!
[addsig]
EastSideGuy,
It is not always easy to get in on the first release. I have bought preconstruction after several releases and the price is higher. I will still go for it if it looks like prices will continue to go up and I can make a profit after all my expenses. I will usually apply for a loan with the builder because of the closing help assistance but I still shop around to see if I can get a better rate. You can also negotiate with the builders lender on rate if you can show them you can do better elsewhere. Good Luck
Thanks for the answer. i have a follow up question to that... Is it still possible to go no-doc when applying for a loan with the builder, or are they more specific on what they want to see as far as your financials?
I can give you more information about this process. Please email me at **Please See My Profile**
EastSideGuy
You should be able to go no doc. The big builders have their own mortgage companies and offer just about any program out there. They make loads of money lending and want your loan. The smaller builders use "designated lenders." They too want your business. Just watch the interest rate they offer or points charged and the yield spread premuim. Some builders that offer closing assistance say $5000 require the lender to contribute a part of this help. The lender just makes it up on the loan in higher rates,points or YSP. Gotta keep your eyes wide open when dealing with any lender. :-o
Smyths20 it won’t allow me to email you. Is there any other way I can get in touch with you?