Rental Basics in 93307>Question Details

Wisdom, Both Buyer and Seller in 93307

My lender says he'll provide me w/letter of commitment what do i do next to make money with that, i would like to buy multi family home rent

Asked by Wisdom, 93307 Mon Oct 4, 2010

them out. I'm new but done a lot of studying will hud accept that letter?

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Find an agent you like working with. the agents below are all good. In regards to james answer "Letters that come from established lenders like a Bank or Credit Union are stronger than letters from..." I have to respectfully disagree. I just left a very large bank a few months ago and their letter were useless to any agent that knew better. As long as your lender was referred by an agent you should be ok with that end. Big banks and credit unions usually are slower with strickter guidlines. And higher fees per same given rate. Thats just in general. Wells and Kern Schools do better than the others if you are going for large lenders.
0 votes Thank Flag Link Wed Feb 15, 2012
First question. By multi-family home are you meaning 1 to 4 unit which is single family or 5+ which is multi-family?

Lending guidelines are very different. Also, no one provides a Letter of Commitment without a specific property address. Did you mean a pre-approval letter?
Web Reference: http://www.umboc.com
0 votes Thank Flag Link Wed Oct 6, 2010
HUD allows owner occupant bids only for the first 10 days on the market. If they do not receive an acceptable bid during those 10 days, then then open bidding to investors. HUD will accept you pre-qual letter as long as your lendeer is HUD certified. Check with him and have him confirm this. My broker is the HUD listing broker for all of Kern County. If you have a "Pre-Qual" letter from your lender, you are ready to start looking. There are some great buys on investment properties right now.
0 votes Thank Flag Link Wed Oct 6, 2010
It sounds like you have been approved and you're ready to look at properties. Due to many banks (Chase for instance) experiencing less foreclosures than they expected on multi-unit properties in Bakersfield, financing has become easier. For many reasons, there are few (if any) HUD multi-units out there right now. I would suggest working with a Realtor that owns investment properties. He or she will know the pros and cons of investing and trust me, there are both!
0 votes Thank Flag Link Mon Oct 4, 2010
Fannie Mae, HUD, and Freddie Mac typically will accept a lenders commitment to fund. But, it also depends on how the letter is structured, what it actually says and who it's from. Agents and sellers are looking to see that you have been to the lender, they ran your credit and verified your income. Sellers also look at where the letter is from. Letters that come from established lenders like a Bank or Credit Union are stronger than letters from unknown or out of area lenders. You have made a good first step. Your next step is finding the right property that will fit your needs.
0 votes Thank Flag Link Mon Oct 4, 2010
Hello,

If you have a letter of prequalification, or preferably approval, you should be ready to start looking.

You asked about HUD and your letter should be fine, but keep in mind that HUD gives preference to owner occupants, meaning that they will only look at offers from investors if they don't receive an acceptable offer from someone who plans to live in one of the units. There are many other properties available that do not have these requirements.

You may find the search page below useful... it has an option to search specifically for residential income properties.

Thank you,

Robert and Dawn
0 votes Thank Flag Link Mon Oct 4, 2010
Do you mean a prequal letter stating the loan amount? If so you just need to work with a Realtor to find the right property. Call me @ 661-616-3660!
Thomas Hansen
0 votes Thank Flag Link Mon Oct 4, 2010
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