To qualify, lenders are primarily concerned with the amount of equity you have invested in the property. The more equity you have, the better terms you will be offered. The amount the lenders can lend to the borrower is primarily based on the subject property's value. The property may be one the borrower already owns and wishes to use as collateral, or it may be the property the borrower is acquiring. Credit and employment are not so critical, provided you can prove you have the resources to make the required payments and that you can present a plan on how you will ultimately repay the loan by the end of the term. You can also choose your preference - monthly payments of only interest or interest and some principal with a balloon payment at the end of the term.
A borrower can borrow on almost any type of property – single-family residential, multi-family residential, commercial, land, and industrial.
Some lenders may specialize in one specific property type, such as residential, and not be able to do land loans simply because they have no experience in this area. Most lenders have a specific niche of loan they are most comfortable with. Ask us upfront about which type of mortgages we can fund.
Make sure your exit plan is clear -
Renovate or develop the property, then sell it (flip)
Renovate or develop the property, then refinance with a lower cost lender once complete (hold)
Sell the property
Inheritance or settlement coming soon
Credit/employment improvements expected, qualify for traditional bank financing ASAP.
Normalize cash flow/operations, qualify for bank lending
Qualify for construction financing
Sell another property and payout.
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