Sat, Jul 04, 2009
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Subject 2 with a bridge loan? |
knucs
103 Posts
Member Since: 04/10/2003
Wausau, WI
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Posted: 21:37 on 06-24-2003
Hi all,
What can you do with a property that has a bridge loan because they bought a new property and are trying to sell their old home. Is it generally an interest only loan? What buying approach works best if not Sub To?
Stats
Comps 97-100000
buyer looking for 91-92000
owes 55000
Wait till more motivated?
Kelly
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KyleGatton
936 Posts
Member Since: 10/07/2002
Kenneth City, FL
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Posted: 10:25 on 06-26-2003
Bridge loans are almost always interest only. I would buy the bridge loan and make the interest only payments profit. There isnt enough equity if the loan value is 92% of the assessed value. Unless you could devise a way to rehab the house with an add on to make more of a percentage.
Good luck,
Kyle
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rajwarrior
1657 Posts
Member Since: 03/05/2003
Claremont, NC
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Posted: 08:36 on 06-27-2003
Here's a suggestion.
Have you broken the deal down to the buyer's actual equity?
Selling for $92K, Under normal selling, -$5.5K for RE commission, -$3K for buyer's offer (negotiating), -$3K for closing costs, and I'd add another $3K for repairs/holding costs, etc. That gives $14.5K subtracted from $92K gives you $77.5K. If he can accept that, then you've got a deal, if not he ain't ready to sell because that is what he'll get any other way.
Now as far as the loan goes. Little confused with the bridge loan thing. I thought the bridge loan would only affect the new house not the old one. Doesn't matter really.
If the house can really appraise for $100K, then you can either do 1)have seller owner finance remainder of equity and subject to the loan (bridge could be difficult, usually short term loan) 2)have seller refinance for $77.5K and then take over subject to (best subto approach). 3)have seller to a short term owner finance (60 days), deed you the property at closing and you get a no seasoning refinance loan yourself and payoff the owner financed note. At less the 80% of value, this shouldn't be too difficult.
Roger
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knucs
103 Posts
Member Since: 04/10/2003
Wausau, WI
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Posted: 17:32 on 06-27-2003
Thanks for the input guys!
Kelly
PS-I think I'll be passing on this one-I've got alot of other calls to work on. It seems I'm the only one using bandit signs in my town (not very big-maybe 75000 in the surrounding bergs) and getting a fair number of calls just from a few targeted neighborhoods!
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