Selling A Sub 2 Prop.
hi, im going to try and make this as clear as possible. im still new at this. If i get a sub2 deal all said and done and i have 30,000 equity in the house. say its been 1 month since i closed on it. i put it for sale and now somebody wants to buy it at market value or a little below. since i had the prop deeded to me only a month ago will the new buyers lender lend on this prop and with the new lender know what i am doing and know that i took this prop sub 2?..so basically all i am worried about is that i wont be able to sell my prop to a conventional buyer right away becasue they wont lend on the prop. because i havent had it for long enough. can i get around this by selling way below mrkt value..any help would be great. thanks , Ryan
Not all loans have to be seasoned. Just make sure your buyers lender know that is one of the stipulations.
Sire
I'm not exactly sure i know what you mean. Thanks, Ryan
Ryan,
You said, "so basically all i am worried about is that i wont be able to sell my prop to a conventional buyer right away becasue they wont lend on the prop. because i havent had it for long enough."
Loans that lenders wouldn't lend on because of time requirements are called seasoned loans. Sire is saying that not all loans have this requirement. You can find loans that have no seasoning requirement (in other words, they don't care how long you've owned it).
Shop around.
when the new buyers lender does a title search the land trust will come up with you as the trustee and the seller as beneficiary, because you have hidden the fact that you have beneficial rights, correct. then what im saying about lying to the new lender is that will they not lend money based on the fact that the house was just deeded to a trust? will they know that we are the real owners? and should we lie to them and tell them the sellers still own the house so that seasoning isnt an issue and they will lend the money.
You are way over thinking the process. They don't really care, as long as you can deliver marketable title at closing.
First, NEVER LIE TO A LENDER. It is loan fraud and you can go to jail or be heavily fined.
Second, many lenders understand Sub2, or they can read about it in HUD's own docs, so don't be worried about the fact you bought it Sub2.
Third, seasoning is a problem if you are making a big profit and cannot show how you increased the value. Just document what you did, how you made it more attractive, and especially how the sale price is its true value by getting good comps from a realtor or appraiser.
Good luck
Peter
thank you guys so much you have been such a help. i am only 19 years old and want to get everything just right so i am not laughed out of the lawyers office. i know that lawyers dont really know much more than they were taught and cannot think on their own but being my age it is hard to get people to take you seriously. i am a little nervous about doing my first deal and telling a 30+ year old that I can help them. i know i can do it and though and when i do i will have a great big post on here thanking all of you. thanks again you are all great, Ryan
I have asked my mortgage broker to line up some lenders who do not require seasoning so that if my buyer is running into this with their lender I can refer them to my broker.