There are many lenders that only require seller to be on title for 90 days. Generally, subprime lenders require longer title seasoning. To answer your question, yes it is possible. Your buyer may have to search a litte bit for a lender.
The best thing to do now is to start looking for a lender for your buyers. It will be good to bring a lender people and also increase your chance of them closing.
[addsig]
or you could take control of your exit strategy, and use owner financing temporarily to attract the largest buyer pool, and then sell that note at closing for a minimal discount.
Why price your property below FMV, or engage in price reductions, when you can start out of the gate with this great way to bypass title seasoning issues.
Why wait for a bank to tell you when they are comfortable - as the seller YOU BE THE BANK.
Note buyers of seasoned or unseasoned notes do not care about title seasoning.
As should be obvious by this point the buying and selling are not an issue.
It is only the financing that can slow you down.
1. Find lenders who do not care about the less then 6 months. Sometimes this will mean being able to show how the place was improved through repairs (documentation so the improvements)
2. Use seller financing to sell the place. You can hold or sell on the note. You can break the financing up into two notes. The 1st you sell and hold the second until it is seasoned. Or you use one note but sell a partial so that you retain some of the risk but likely get a better price.
3. You sell for cash or to a buyer with such a large down payment that they will not care about the seasoning. If all cash - no issue. If a large down payment (25%-30% many lenders care a lot less).
4. You use a HML to buy, you repair and then rent until the place is seasoned. Likely to cost you more in financing and might be less attractive to a buyer then something just fixed up. Could work fine if the buyer is an investor. If you use a HML you may have so little of your cash in the deal that 6 months of finance costs (all in finance costs) will be less then the discount on the price or on the price of the note.
Bottom line is you have a number of options. You can not use the traditional (normal) path as you are not selling a home that you have owned for years, etc. The time you invest in figuring out your financing options (and the options that will work best for your end buyer) will be well rewarded assuming you are buying right.
This was recommended to me by my REI mentor when I ran into the same problem.
Work with your local "mom and pop" banks. They are much more flexible than the national chains and are less strict with seasoning issues. You can also get in front of the decision makers easier. Many of these banks tend to be portfolio lenders in that they don't sell loans off to other banks.....they keep them in-house until they mature.
Once you find a bank with no seasoning requirements, tell your buyers to use your bank or you have no deal (make it a part of the contract). Besides, you know your lender will get it done and other won't which will only waste your time that you could be finding another deal. Even if the are pre-qualified, their bank will still have those seaoning requirements that will keep you from closing.
You also need to take lots of pictures and document everything you do like a journal or ongoing inventory. This will go a long way in justifying your ARV.
Another option is a mortgage broker . I use one for my financing and he has several lenders that dont require seasoning and their rates aren' t any higher . George
Mortgage Brokers are probably your best bet and I dont say that just because I am one. I just know of several banks that dont require any seasoning. I can refinance my own homes and get cashout the day after I buy them if I choose its all in who you use.
There are many lenders that only require seller to be on title for 90 days. Generally, subprime lenders require longer title seasoning. To answer your question, yes it is possible. Your buyer may have to search a litte bit for a lender.
The best thing to do now is to start looking for a lender for your buyers. It will be good to bring a lender people and also increase your chance of them closing.
[addsig]
or you could take control of your exit strategy, and use owner financing temporarily to attract the largest buyer pool, and then sell that note at closing for a minimal discount.
Why price your property below FMV, or engage in price reductions, when you can start out of the gate with this great way to bypass title seasoning issues.
Why wait for a bank to tell you when they are comfortable - as the seller YOU BE THE BANK.
Note buyers of seasoned or unseasoned notes do not care about title seasoning.
Hope this helps, Dave
As should be obvious by this point the buying and selling are not an issue.
It is only the financing that can slow you down.
1. Find lenders who do not care about the less then 6 months. Sometimes this will mean being able to show how the place was improved through repairs (documentation so the improvements)
2. Use seller financing to sell the place. You can hold or sell on the note. You can break the financing up into two notes. The 1st you sell and hold the second until it is seasoned. Or you use one note but sell a partial so that you retain some of the risk but likely get a better price.
3. You sell for cash or to a buyer with such a large down payment that they will not care about the seasoning. If all cash - no issue. If a large down payment (25%-30% many lenders care a lot less).
4. You use a HML to buy, you repair and then rent until the place is seasoned. Likely to cost you more in financing and might be less attractive to a buyer then something just fixed up. Could work fine if the buyer is an investor. If you use a HML you may have so little of your cash in the deal that 6 months of finance costs (all in finance costs) will be less then the discount on the price or on the price of the note.
Bottom line is you have a number of options. You can not use the traditional (normal) path as you are not selling a home that you have owned for years, etc. The time you invest in figuring out your financing options (and the options that will work best for your end buyer) will be well rewarded assuming you are buying right.
John
[addsig]
This was recommended to me by my REI mentor when I ran into the same problem.
Work with your local "mom and pop" banks. They are much more flexible than the national chains and are less strict with seasoning issues. You can also get in front of the decision makers easier. Many of these banks tend to be portfolio lenders in that they don't sell loans off to other banks.....they keep them in-house until they mature.
Once you find a bank with no seasoning requirements, tell your buyers to use your bank or you have no deal (make it a part of the contract). Besides, you know your lender will get it done and other won't which will only waste your time that you could be finding another deal. Even if the are pre-qualified, their bank will still have those seaoning requirements that will keep you from closing.
You also need to take lots of pictures and document everything you do like a journal or ongoing inventory. This will go a long way in justifying your ARV.
From the day of purchase, all cash, my best time is 58-days.
That property DID NOT need any of the following:
Foundation, Sidewalks, Driveway, Siding, Windows, or Doors.
The following were installed new:
Kitchen, 1-1/2 Baths, New Carpet, Up-Grade Electrical Service, Ceiling Fans, Plugs and Switches, and Paint.
I had steady Subs and work in the area was slow.
Regards, Frank
Another option is a mortgage broker . I use one for my financing and he has several lenders that dont require seasoning and their rates aren' t any higher . George
Mortgage Brokers are probably your best bet and I dont say that just because I am one. I just know of several banks that dont require any seasoning. I can refinance my own homes and get cashout the day after I buy them if I choose its all in who you use.
Matt