I am selling a property, as is by owner for less than $25000 and prospective buyers are looking for a bank to finance, do you any suggestions for the

Asked by Sassy, 01118 Tue Jun 29, 2010

buyer to and where to find their own financing?

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13
Justin Ruzic…, Agent, Greenville, SC
Fri Dec 17, 2010
nobody/no lender gives loans out in this low amount. There is no money to be made by a lender...i mean 5% on $20000 because they will want downpayment of course, is $100 amonth...you can't keep the doors open at a bank making a fraction of $100 a month...CASH, these are the only buyers you can work with on this property. Can you rent the property out? If so do it,then sell it to an investor..if it rents for $400/month or $4800/year that is a 19% Return on Investment, that seems a lot better than most stocks...besides gold and silver...i digress.
1 vote
Michael Diam…, , Rolling Hills Estates, CA
Wed Jan 12, 2011
Did this work out for you? Any updates?
0 votes
gabriel palo…, Agent, Pompano Beach, FL
Wed Dec 22, 2010
Hi Sassy,

Just checking back with you how you are making out with your deal? Pricing the property aggressively is indeed a smart move if you want to sell quickly and shine against the competition.
However I am not that sure that I agree in the method that you are selling it by yourself. We all could use professional support especially in regards to finance. Selling the property "as is "does have it's advantages but it should be used as a bargaining chip instead of an open door for concern. I do believe that a seasoned realtor presenting your property for sale would be a wiser choice. You seem to be a very reasonable and savvy person, take advantage of it. A good agent may not cost you in the end more than selling it by yourself but will definitely make it easier handling those tough problems that can pop up during a seemingly simple transaction.
You heard of the expression penny foolish? Do the right thing get some support you won't regret it.

Best Results Are Always Thought Through By Advanced Proven Measures.

Gabe
0 votes
Vera Gonzalez, Agent, Sterling Heights, MI
Tue Dec 21, 2010
Sassy,

What about land contract.

Vera
0 votes
gabriel palo…, Agent, Pompano Beach, FL
Sun Dec 5, 2010
Hi Sassy,
There are buyers and there are lookers...... and there are tricksters. Find a buyer that knows the answer to your question before you accept his offer. Either he has the money to buy it with or not? . Be careful that you don't get tied up or hung out to dry waiting .
0 votes
Deanna, Home Buyer, Indiana
Sat Dec 4, 2010
I am a home buyer 9so limited experience) and bought a fixer-upper for 51,000, that had the potential to be worth 175,000. I got a loan through a small regional bank as someone else suggested. What they gave me was a construction loan. I had to have an appraisal for as is condition and another one that considered the proposed renovations. At closing the first draw from the line of credit was for the house, then other draws occurred as I had work done. After the work was done the original appraiser returned and did another appraisal. The loan then was rolled into a conventional mortgage and sold to Chase. The downside of this is that the closing costs are higher and some of the fees you pay for more than once. I am not sure that this would work for your buyer, but it is what worked for us.
0 votes
., , Outer Sunset, San Francisco, CA
Sat Dec 4, 2010
Boy would I like to weigh in (deeper) on this one. To any buyer using a mortgage broker with a loan that small (under 70k) be real careful how you proceed with transaction. Watch the process through like a hawk. When all conditions are satisified close asap. Should you be real casual with it and not pay close attention I warn you now you do not dream of what can happen. Trust me it can turn ugly fast. It is actually a good question because too many first time buyers under estimate the importance of a seasoned agent not to mention the loan origionator or attorney (required in my area).
0 votes
Ken Lambert, , Exeter, NH
Sat Jul 3, 2010
Hello- I've been a mortgage officer for 2+ years and this is going to be a tough one. Your only hope is with a small regional bank. Not a mortgage company or mortgage broker per se.
What town is the home in ? Call the local banks in town and throw it by them to see if its something they could finance. You'll be more likely to have some luck with that.

No national lenders will touch this- for various reasons.
Thanks and good luck,
Ken L.
0 votes
Kevin Vitali, Agent, Tewksbury, MA
Wed Jun 30, 2010
This is where things can get sticky. As a seller you have to be very careful of liability in recommending a lender. If you recommend someone and they don't get the loan (or the best terms or any number of things....) this can fall back on your shoulders. When it comes to service providers the buyers need to find their own service providers.... (mortgage originators, home inspectors, attorney's.....) You don't want a buyer coming back and say you were in cahoots with someone. Now if the buyer is working with a buyer's agent a buyers agent can recommend specific providers. If you do suggest a bank(s) or lender(s), make sure in no way do you imply they have to use that particular lending institution.

If I am working for a seller and and a buyer comes directly to me and asks for recommendations for like a home inspector, I refer them to the state website for home inspectors and NAHI (National Association of Home Inspectors) This way they have a large list and are choosing their own provider. The key is you are not choosing for them.

Personally as a listing agent, I have no problems if they are working with a buyer's agent. The buyer's agent/ listing agent(seller) relationship has a hard line of liability drawn between the parties. The buyer's agent takes on a lot of liability and takes a lot of liability off the seller.
Web Reference:  http://www.thehousewiz.com
0 votes
Scott Godzyk, Agent, Manchester, NH
Tue Jun 29, 2010
That is where the agents earn their paychecks by assisting the seller and then also assisting the buyer in getting their financing. as a seller assisting with their financing is a touchy subject and due to liability not something you should be doing. If you want to come back and expand your question, we can try and better answer it.
Web Reference:  http://www.ScottSellsNH.com
0 votes
Don Tepper, Agent, Burke, VA
Tue Jun 29, 2010
That's a very small amount to finance. Most lenders won't be interested, though certainly give Carrie's recommendation a try.

There are a couple of other alternatives. You could always offer owner financing. If you don't need all the cash right away, you'd just create a note, same as a mortgage. It can be for whatever length you want, and at whatever interest rate you want. (Just watch out if Massachusetts has usury laws.) But, for instance, $25,000 at 6.5% for 7 years would equal monthly payments of $371. Or 6% at 30 years would come to monthly payments of $186 a month.

Another possibility is creating a note with the intention of selling it for cash. You'll still have to wait a bit to "age" the note--to prove to whoever you're selling it to that the buyers are dependable. And you'll have to sell the note at a discount. But that's a way to get all your equity out in perhaps a year.

Another possibility is for the buyers to take out a personal loan, rather than a mortgage.

Or some combination of the above--such as the buyers taking out a personal loan for $10,000 and you creating a note for $15,000. So you'd get $10,000 up front and $15,000 over time.

Or the buyers might find some private financing. Someone willing to lend them the $25,000 at a reasonable rate of interest. An investor might even do it out of a self-directed IRA. The buyers themselves wouldn't be able to use a self-directed IRA (unless they're buying as an investment), but someone else could buy it from you, then resell on terms to the ultimate buyers.

And there are plenty of other ways to finance it, as well. The ideas above just barely scratch the surface.

Hope that helps.
0 votes
Matt Heisler, Agent, Westborough, MA
Tue Jun 29, 2010
Sassy:

I'm sure there's something I don't understand in your question, but that's what banks are for. It's too small an amount for a mortgage? Just get a collateralized personal loan, such as they do for Motor homes.
0 votes
Carrie Touch…, Agent, MA, CT
Tue Jun 29, 2010
Jason Jean
Loan Originator
413-565-2248 Direct
413-374-3252 Cell
877-469-3870 Fax
jason.jean@prospectmtg.com
http://www.prospectlongmeadow.com

Hope this helps!!

Carrie Polci
0 votes
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