Hello,
I'm under contract for my 3rd property, a REO. Its a financing and my lender wants an appraisal. Problem is, we are finding issues in the house. For one, the plumbing froze in a few spots and the lender wants them repaired. The lender also wants the water heater to be repaired.
I’m under contract and I’m closing in a little more than 3 weeks. I do not want to repair a house that is not closed yet.
My realtor, who's amazing, referred me to another lender who's offering to take over, lend me not only the purchase price but the repair cost for up to 80% of the ARV. They dont do an appraisal but the do an in-the-house determination of the value of the house based on comparables, at no cost to me.
Now, my current lender would only lend me the purchase price, then I have to refi in 6 months to recoup my rehab costs.
Is this too good to be true to find a new lender give you purchase price and rehab expenses lended for 30 years at 5.5%?
If they lend me purchase price and refi cost then I dont have to refi and I could BRRR with only 3 Rs.
Where is the catch????
Plus, where my current bank would only finance me for maximum 6 rental properties, this new bank would finance me for up to 8 millions. And my purchase prices are usually 50-70K, meaning that i can buy 100 houses with them.
Where is the catch???
Anyone having a similar experience?
