Where To Find Financing
I just had my bid for a HUD house accepted. Now I need to arrange to pay for it. My bid is 67k and with a roof and some cosmetics it should sell at around 112k. I have good credit as far as making payments on time and the amount of credit I have, but my debt ratio is a little out of balance right now so my credit scores are in the low to mid 600's. Is my best bet a hard money loan? Can anyone suggest someone they have had a good experience with? or any other suggestions.
Thanks
I didn'y think debt/income ratios had anything to do with credit scores. Someone please correct me if I'm mistaken. Zach
I also agree that debt to income ratios have nothing to do with credit scores. Lenders do typically require that your housing costs do not exceed 30% of your income.
sorry, I meant to say my balance to credit available ratio....
for the SECRETS TO UNDERSTANDING YOUR CREDT SCORE go to www.cscmortgage.com and download their .pdf.
It'sthe best 10 pages you can read on how credit works.
Actually, I am having a little of the same problem myself right now. My solution, and the only one I've been able to think of that will work for me, is to dump a dog that's throwing my ratios out of whack. Think about what you can do to get your ratios back in line with what your bank feels is acceptable. If you're sure you can make the payments, at least until you can fix the property and sell it, you might be able to "increase" some rents (if you have any), or use another strategy to inflate the appearance of your income. If your lender is scrutinizing you, which he probably is by now, it might not fly anyway, but if he's on your side (mine actually suggested it to get it through the underwriter), it might work. I don't need to tell you that this is risky business, and also that banks have certain qualifications for a reason. It's easy to get in over your head, and I would never recommend that anyone fudge numbers unless that person knows exactly what he's doing and the consequences that accompany the strategy. Hope I don't catch h*ll for that, but this is the "creative invester". What about a partner? Zach
Oh, one more thing just to clarify. One of the reasons I was able to artificially inflate the appearance of my rental income is because I had only recently bought the rental in question, and having owned it only in the calander year that I was attempting to borrow, there were no real income records, just my doctored rental agreements, which satisfied the banks request for proof of income. My bank statement was so inconsistant, they weren't really sure what was going on, but, hey, I got the loan. Have mercy on my soul. Zach.