HELP! How Can I Finance $150k for downpayment for Owner Financing

[Lisa Hall]

Please HELP ME!! I need to borrow $150,000 to fund the downpayment on a Primary Residence I want to buy.

The total purchase price is $400,000. The owner will finance the $250,000 at 3% over 10 Years amortized over 30 years with a balloon due at the end.

This home has $100,000 equity - easily comped at $500,000. This is a friend of mine - that is why it is such a good price - and she just wants out! 

She needs the $150k to pay off her home.

Is there a way to borrow $150,000 using this house as collateral. I have researched this for weeks - and I can't find ANYTHING! 

Every lender says that they need to finance the entire home - and have no options to fund the downpayment only.

Or I need to already own it to do a Cash Out Re-Finance to pay her back. She wants paid at closing when we transfer the title. 

We are already under contract.

I know there is a way to do this, I just can't figure it out!!

I am hoping for a 10-30 Year Arm / Fixed Rate - with an interest rate under 7%.

Is this possible?

My credit is about 720.

I am maxed on DTI at 55% - so a personal loan won't work.

Because all of my income is from rentals, my income does not qualify for traditional financing.

What am I missing?

I know there has to be a way?

MAHALO for helping me figure this out!!

xoxoxo

Kai

If you have actual websites or contact information - that would be SOOOOO helpful! 

[Kevin Romines]

You mentioned you want to buy the property as an owner occupied or a primary residence. With that in mind, you can not do a hard money loan on a primary residence, its illegal. 

That said, my suggestion is that you go get the scenario pre-approved as if you have been on title for 6 months, for a cash out refinance through Fannie Mae, also paying off some of your debt to get your debt ratio below 50% or less. Once you have that pre-approval, take it to your friend and show them that the scenario at that time under those conditions is pre-approved. Use that to help her feel more comfortable about putting you on title (she can stay on title with you, as a safety valve so to speak, in the event she needs to get you back off title). Once on title, wait out the 6 months required and then complete the Fannie Mae cash out refinance up to 80% LTV on a primary.

If that is not enough money to cover the whole purchase price of $400,000.00 plus any debts you need to payoff, then follow the 1st mortgage up with a HELOC for 90-100% as the remaining cash needed to cover all items. You can do the 1st and 2nd simultaneously.

Yes, the draw back is that she has to a wait 6 months, but during that time your making the payment to her, so it relieves some of the burden on her. The alternative is that she sells it to someone else that can buy it today. 

I hope this helps?