Adam King (MI) 1 Report post Posted April 4, 2004 Hey all,I thought I would share something that saved a deal today. (This time it’s free) I went to show a house to a nice couple (The one that I was just complaining about not being able to move) today and was a little confused to why I was wasting my time. They sounded like really good candidates, but they said they had no money to put down because it was all tied up in a house they were trying to sell. (Double negative by the way) The only reason I was interested in showing it to them was because they said they could afford both payments until the house sold and they had decent credit. I wasn’t sure there would be a solution, but I had to try. There we were, standing outside of the house after looking at it inside and out. They LOVED it! Time to talk about the money...... We want the house Adam and I think we have good enough credit to buy it within a few months (He was right), but we don't have the money down. My mind started going a hundred miles an hour trying to come up with possible solutions. So, you guys have "nothing" to put down?Yeah, we have it all in the other house, but we could come up with it when it sells.Well, that's not going to work because even with cutting me out of the deal completely, the owners need money to move to FL.We were all in deep thought....and then it hit me. I had a way for them to come up with MORE than $5K. I looked at the wife and said, you're a nurse aren't you?Yes, she said.How long have you been a nurse?7 years.Well, there's our answer. They both looked at me confused.That means you probably have a 401K right?Her face lit up. I actually have two of them with more than $30K she said.I smiled... We should be closing on Tuesday. And yes, they’re talking about putting almost $10K down.Thought I would share a deal saver because I have lost too many people when there seemed to be no solution. If I only knew now what I did then...Regards,Adam Share this post Link to post Share on other sites
Jason (AL) 1 Report post Posted April 4, 2004 Nice save Adam. Something kept me thinking about that house your buyers were trying to sell.... What's the skinny on that?Have you inquired about whether it's listed.......how long they've been trying to sell.....??? Maybe there's something you could help out there. From what you stated in your post, they don't seem to be in too big of a hurry.I'm not sure what the complete story is behind that particular house (your buyer's house waiting to be sold), but are ya gonna check in about it? Just wondering.......it's late now.....sorry bout the rambling. :ph34r: Jason Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 4, 2004 Jason,Yeah, it's a 900 Sq ft 2 bedroom one bath on a slab for $129K!!!!!!! I wouldn't touch it with a ten foot poll. Plus, they're interested rate on it is 10.5%! No deal there!But....the house should sell on the market because of it's location. Regars,Adam Share this post Link to post Share on other sites
Andrew Ikeda 0 Report post Posted April 4, 2004 Hey Adam, Just a friendly reminder that I'm here to help you also! Good buddy! With these borrowers, we possibly could have gotten them 100% financing on a second home while their current home is on the market. ALL my deals have been 100% no money out of pocket at closing. My borrowers have had credit issues, downpayment issues, employment seasoning issues, etc. As a matter of fact, I know of no other way. What you could have done is added the closing costs and your fees to the sales price and have your loan officer instructed to check off the 'seller paid closing costs' on the good faith estimate. Usually, I have the realtor or buyer approach the seller about paying a part of or all of the closing costs, then add whatever is left onto the sales price. Then the loan officer sends a letter of instruction to escrow to pay you your fees out of the closing costs (this works as long as you are a third party - no money back to buyer at closing). Earnest money to be paid at closing also included in the loan amount. This is not difficult to do and works like a charm! Dude! 10.5% interest? Which state are they in? What is their......just call me soon! Have they already closed? Maybe we can save the day? I might be able to get them a lower rate and make you look like a king! Oh...no pun intended! Good job Adam, glad you saved the deal. If you're ever in need of some ideas please feel free to contact me, I'd be happy to share what I know and learned from the mortgage industry. Again, congratulations! Oh yea, and thanks again for the e-book! Andrew (Mortgage/Investment Specialist) US Funding Group, Inc. 888-889-1640 ext 220 360-433-6820 direct line 360-260-3272 fax 360-909-3374 mobile andrew.ikeda@usfundinggrp.com and/or andikeda@netscape.net Share this post Link to post Share on other sites
Andrew Ikeda 0 Report post Posted April 4, 2004 Forgot to add two more ideas! In regards to 401k's and IRA's - you can borrow against these to avoid any penalties for early withdrawal. This is usually done with the local bank if not with the company holding the retirement funds. Do your clients have any equity in their current home? Perhaps they could get an equity line of credit as part of the downpayment for the second property? This is a big one for investors looking to get started in their first non owner occupied property. This is also one way to get started in a fixer. Most lenders will require that the work be done before the financing is put into place. Taking a L.O.C. against your current home could be a solution for the fix up costs. Just some thoughts! Andrew Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 4, 2004 Andrew,I'm starting to think you the man! I've learned so much from loan officers this year that I thought the well was running dry. Well, it's apparently not! Thanks for the input and yes, it's MORE then appreciated!Regards,Adam Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 5, 2004 Well, I cursed that one.... We're having a hard time making it happen because it turns out it's not a true 401K. I'll have more info tomorrow if anyone's intersted.Regards,Adam Share this post Link to post Share on other sites
Gary (MO) 0 Report post Posted April 5, 2004 I'm interested Adam, please keep posting! Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 6, 2004 Okay, here's the skinny. Turns out that the 401K was a 401C (Or something like that) and there was very little of the prospect's money in it. The employer was the one contributing the most and there was a clause about not taking any out until a certain time. I know this is probably BS and we're still going to research it. I would love anyone to put in their two cents on this dilemma. I will still try to find out what the real reason was since I don't belief what I've heard. But unfortunately the buyer is serious and it's not just some excuse. We have been talking all day about what they can do to get the $5K. They have been tapped because the husband had his 3rd DWI and lost his license for 10 years. He's getting it back in 4 weeks.Man, this business never gets boring....Adam Share this post Link to post Share on other sites
coolstuff41005 0 Report post Posted April 6, 2004 If you really want this deal, why don't you try spreading the down payment into 10 to 12 months. Maybe they'll go for it. Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 6, 2004 Thanks for the input, but that wouldn't work with the sellers. They must have at least $2K to move. I'm not going to lose this deal either way. It's just a matter of time before the right buyer shows up. As for the other buyers, I received the full skinny. It turns out it was a 403B and not a 401K. They also neglected to tell me that the husband doesn't have a license. He lost it 10 years ago on his 3rd DWI. They also have another child on the way. I don't see things getting better for them until he starts working. We'll get there....Regards,Adam Share this post Link to post Share on other sites
Gary (MO) 0 Report post Posted April 7, 2004 That's tough luck Adam... looks like you're back to the drawing board. GaryPS I've never heard of a 403B! Share this post Link to post Share on other sites
Adam King (MI) 1 Report post Posted April 7, 2004 Hey, how about that ego huh? lol As a dear friend of mine with a very open mind used to say... You'll have that.. lolYup, we'll get it.Adam Share this post Link to post Share on other sites
pinkerton 0 Report post Posted April 7, 2004 "It was the best of times, it was the worst of times." Boy what a rollercoaster ride! Can Andrew bail you out of this one? Mike P. The Legal Eagle Share this post Link to post Share on other sites
Andrew Ikeda 0 Report post Posted April 11, 2004 Good Grief Adam! What did you create now?? 403B I've heard of but that's about as far as it goes for me! So they cant borrow against that, huh? Ok, perhaps they could try going to American General Finance if there is one in the area and getting a personal loan. They can get it interest free for 90 days but then after that the rate is at 24% OUCH! but it is an option! Not sure if I can help you out otherwise. It might be good to just say 'thanks but no thanks' to these folks. He needs to get off the booze and get his butt back to work anyways. No lender would lend to such borrowers because of risk factors. Adam, don't make it difficult on yourself!! I'm going to need some time to find a solution to this one!! Andrew Share this post Link to post Share on other sites
