Official Carleton H. Sheets^® Website

you can look into 203k loans, which are government fixer uper loans. or combine the rehab cost with the purchase price. I have found it helpful to find a lender that will extend 100% loan to value.

Good luck

FRS

Hello All,
You can try creative financing and ask the seller to carry a note so you can do rehab work, you can ask the seller to carry 15% and the lender to carry 85%. This way you can use the sellers 15% to pay for your rehab, do the note for the seller for 5 years at 6% and the balloon payment of the balance paid in full on the end of the 5th year. This way your borrowing someone else's money to rehab the house. If there is any equity in the house, maybe the lender would loan that to you as a construction loan for rehab. Try to be creative and ask the seller only after you present them with your offer. If they are motivated, you will have a win win situation, which is what you want. Good luck and Happy Investing.
Todd

when you set your offer with the seller have him/her give you credit at the end of closing .. this will be helpfull. but get a actual estimate on how much these repairs are going to be first , to make sure that the carry back can cover the cost

Its all in how you set up the deal to begin with. Here's how one of my deals went:

1. Get a Home Equity Line of Credit on another property for $65k
2. Buy the rehab property for $47K using HELOC from other property
3. Pay a guy $7K to do the work if you buy all the materials
4. Put all materials (about $11k) on an American Express Card (no limit to AMEX) and get airline miles to fly grandma in for Christmas
5. Close on property and start work.
6. Two weeks after closing I called Wachovia bank and financed the property for $96k (they electronically valued it at $135k so they never actually saw the property while it was being rehabed. Always just go with the electronic appraisal because an actual would probably be less in a rehab)
7. Two weeks later I finished the rehab work and put a tenant in the place at $900 per month

At the end of the day I have a house with a tenant paying $900/month, $31k in untaxable cash and a paid off line of credit to do the whole thing again.

Thats how you do it.

What is it you plan on doing with this property? What are your plans after the rehab? Sell, rent? Short term, long term? Are you to acquire at wholesale cost? As you can see there are quite a few options. First things first. What is your strategy?

Ok, How do I work this one.
I don't have any money (or credit) to invest with. I live in Canada, but the property is in Alabama.
The house is worth about 130K today. It needs "rehabbing" and is not currently livable. I was told by a Broker that I would have to buy it as a "Builder Property" which means 15% down.
The Owner wants 90K all in cash. So they can free up their credit to build another house on Land that they own elsewhere. They are not interested in carrying a "note" of any kind.
Once the Property is fixed up it would sell for around 220K. My Partner is a Contractor and would go down and fix it up. We estimate it would cost about 20K to "rehab"
Any ideas?

Blkshado