All Forum Posts by: Tyler Standish

Hi,

I am hoping some bankers can lend some advice on this subject (but anyone can). I am trying to purchase my first flip and have run into so many good deals but can't get them because they are cash only. I am considering taking out a $40k personal loan so that I have the cash rather than going with a conventional mortgage. My question is will a bank go for this? I have excellent credit (credit scores of 763 and 768), my debt to income ratio would be about 34-35% with the $40k loan, and I would be using the same credit union that I have been with for many years. I have had 2 car loans (paid off), a personal loan (paid off), and my personal home mortgage with them...never late on any payments. I don't really have much I could offer as collateral as my personal house already has a HELOC on it and there isn't a whole lot of equity in the house when you factor that in. And my car is only worth about $10k, at best.

Thoughts or advice?

Thanks!

@Greg H.

Thanks Greg! Due to the fact that this is a HUD home and in a lower income area (expecting to be able to sell home for about $80-90k after rehab), in your experience, are those buyers typically using FHA financing? I don't want to severely limit my pool of potential buyers. Just trying to think of everything when considering putting an offer in.

Thanks!

@Wayne Brooks

Thanks Wayne. To clarify, if the buyer (after I rehabbed) was NOT using FHA financing, would this eliminate the 90 day restriction? Also, if you sell the house for more than double what you paid, is a second appraisal required? I wasn't sure if that was part of the anti-flipping rule or something entirely separate related to HUD properties?

Thanks for the replies everyone...I think I am still confused though (maybe even more :) If HUD has no deed restrictions, and I am using conventional financing, I should then be able to sell whenever and for whatever amount, is that correct? I know there is a good chance that it will take that long to renovate, but if it only takes 2 months, I don't want to sit on it for a month.

Hi,

I am looking at a HUD property to flip. This would be my first fix and flip, so I am very new to everything. I was hoping to get some clarification on the anti-flipping rule. Does this only apply if the buyer is going to be financing with an FHA loan? And if so, is it typical that buyers of these homes are most likely going to be using FHA loans?

Thanks!

@Elizabeth J Humphrey

Thanks for the info....out of curiosity, were you able to purchase for lower than asking price?  The property I am looking at has been on the market for about 80 days, and I think has been owned by Fannie Mae since January (according to county records).  They reduced the price to $61,000 (from $65,000) in June.  The house would need pretty extensive upgrades -  I would need to replace entire HVAC system (including converting from oil heat to gas) and it would most likely need roof and siding.  I wouldn't pay more than $50,000 for this property, but am wondering the chances they would reduce that far.  I am thinking they might since it's been on the market so long.

Thanks!

@Lou Migliaccio

Haven't seen it in person yet, but roof is ok (probably needs a new one, but not collapsing).  Bathroom and kitchen are totally ugly and gross, but look like they would be functioning (house has been vacant since January).  When you say "operating bathrooms," does this mean I would need to have water turned on to verify in order to qualify for loan?

Thanks!

Hi,

I am looking to do my first flip and found a house owned by Fannie Mae that has been on the market for almost 3 months.  My question is does a Fannie Mae property need to be purchased with cash?  I would be doing a conventional mortgage (I do have pre-approval letter from lender).

Thanks!

Hi,

I am just wondering if anyone has ever had luck reducing or eliminating some of the closing costs.  I am going through a credit union for a conventional 15 year mortgage on a flip house.  There is a $50 credit report fee and a $25 document fee.  Would it be reasonable to ask to have these removed?  The $50 credit report fee seems rather high to me.  I am not sure if they are required to pull the report themselves (probably) or if I could just provide it for them (obviously getting it from the credit reporting agency they request).

Thanks!

@Brandon Hall

Oh ok, that makes sense.  Can I use my start up costs incurred in 2015 as business expense deductions on my 2016 taxes (assuming I have purchased a property in 2016)?  There are certain items that I would probably wait to purchase if I am unable to do that (for example, I probably wouldn't buy a printer until either the earlier of 2016 or until I have a property under contract).

Thanks for all your help!