Other concers were:* Other than asking him directly, are there places I can find out information such as if he has already borrowed money against the property, if so, how much has been borrowed.

What I can tell you about lenders is that there usually are three main factors that will affect you ability to borrow money to buy a deal. 1- Your relationship with the lender.

The equity sitting in your property "earns" the interest rate on the mortgage, which is low but 100% guaranteed, as in you are certain to not pay interest on money you don't borrow ... refinancing that equity out and investing it in other projects "earns" the return on that project minus the mortgage rate, but there is more risk you take on.

Typically those lenders want to see a successful track record (even just 1 or 2) before they get on board.Also, a bank usually won't give a conventional mortgage if you're also borrowing DP and construction costs.

The bulk of our borrowers do not qualify for conventional for a variety of reasons like less than 2 year's self employed, debt to income ratio and credit issues that have driven their score too low to qualify.Stephanie

According to HUD Handbook 4155.1, the FHA won't insure more than one principal residence mortgage for the same borrower.

This sounds like a loosing propsition.And you should call the lender about borrowing the 30% and living in it... if you lie to them and then they find out you will be in a worse situation than if they say no now.

In Georgia we have to bring cash or equivalents to the auction so you need to have the cash, a backer or an asset to borrow against.Its a high risk/medium reward proposition in my area, but your results may vary so make sure you understand that going in.

Borrower typically pays all fees including appraisal fee, title fees, attorney fees for docs, insurance, etc.

I am not afraid to borrow money on a variable rate at prime + X%.