Using loans for down payment

[Malcolm Jackson]

Hello all.

I’m looking for some creative ways to finance a property. I’m planning on using a vacation home loan to get the down payment down to 10% down. I planned on financing the down payment with a personal loan until I was told today by my loan officer that the underwriter won’t allow that to happen.. I’m on my 3rd real estate book and have yet to read about that and so confused why that would even be an issue.

This whole process is so frustrating and ridiculous the hoops you have to jump through to get a property, yet banks will throw themselves at you to be in debt for the rest of your life for a college loan. Can’t stand the world we live in sometimes.

Anyway, I’m reaching out to get some help and feedback on other options I can take to get a property financed without using my own money. My issue is financing a down payment to a vacation home loan. I have great credit and a steady job. Looking for a creative way to get this done.

Thank you.

[Afam Agbodike]

It depends on your income and how long you've had the personal loan. If you plan on taking out a personal loan during the process of purchasing the home, then it probably won't work (at least with conventional lending), but if you take out the loan several months in advance ("seasoning" the money), then it will come down to your debt to income ratio, if you can manage the personal loan payments and the mortgage payments and any other debt payments and still stay within the required debt to income ratios then a good mortgage broker should be able to make it work.