Rental Property Investor · Columbus, OH · Member since 2017 · 3k+ posts · 3k+ votes
I recently came across an incredible deal near where I live. Its priced at 97k, comps for a house in good condition are in the low 200's. Instead of spend months fixing and flipping this place. Id rather wholesale it (I believe in Ohio I must buy the home first then resell?)
So I am looking for what type of loan do I get? Can I get an owner occupy loan for 5% down (intending to live in the property) and then sell it after 2 months. Or do I need to get an investor loan for 20% down and most likely pay a pre-payment penalty?
Lender · St. Louis, MO · Member since 2009 · 348 posts · 164 votes
7y
You could get Transactional Funding to give you 100% funding to purchase the property, and then immediately re-sell it to your end buyer that same day at the same title company. There would be no cash out of pocket for you, and you'd get your profit spread at the second closing. These would be both the same day, so you would not be living in the property.
Specialist · Charlotte, NC · Member since 2016 · 239 posts · 117 votes
7y
Are you 100% intending on living in the property? If so you could make some small cosmetic repairs and resell. You wouldn't get near the 200k comps, but you would probably make a decent return on your expenses.
If it's really a deal I would be weary as to why no one has bought it yet. Depending on how long it's been on the market.
You could also just do a regular wholesale and double close or assign
Lender · St. Louis, MO · Member since 2009 · 348 posts · 164 votes
7y
You could get Transactional Funding to give you 100% funding to purchase the property, and then immediately re-sell it to your end buyer that same day at the same title company. There would be no cash out of pocket for you, and you'd get your profit spread at the second closing. These would be both the same day, so you would not be living in the property.
Investor · Philadelphia, PA · Member since 2016 · 2k+ posts · 1k+ votes
7y
Depending on the condition of the house, you may have difficulties with standard financing. They expect the house to be livable condition at closing and may require repairs to be made before closing, which could cause issues.
Had that issue when I first got started. A roof leak and half the dining room ceiling caved in... they almost wouldn’t close without pleading and confirming that I was going to fix it as soon as taking possession. Then couldn’t get a CO because of similar issues...