Preapproval letter with $0 in the bank while using seller credits (WA)

[Delaney Mizell]

I am buying my 2nd live and flip (~300k) and want to use another 3% down conventional, I also plan to get 4-5% back in seller credits at closing meaning I will need maybe 1% of purchase price in my bank at closing after all is said and done.
I am using a loan officer right now who is not the best and says that I will need to prove I have atleast 6% (~20k) to get a preapproval letter.
Is this a hard stop for preapproval or can a good loan officer make it work knowing I am getting seller credits ?
 

[Jay Hurst]

Quote from @Delaney Mizell:

I am buying my 2nd live and flip (~300k) and want to use another 3% down conventional, I also plan to get 4-5% back in seller credits at closing meaning I will need maybe 1% of purchase price in my bank at closing after all is said and done.
I am using a loan officer right now who is not the best and says that I will need to prove I have atleast 6% (~20k) to get a preapproval letter.
Is this a hard stop for preapproval or can a good loan officer make it work knowing I am getting seller credits ?
 

To use 97% financing with a CONVENTIONAL loan as a non first time homebuyer you would have too make under 80% AMI in your zip code. You can find out where you stand here: https://sf.freddiemac.com/work...

Secondly, with a loan to value over 90% you would be maxed at 3% seller credit.

You would be better off with a FHA loan for the lowest cash into the deal, but if your current loan is an FHA that would be a roadblock.