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Started By
Message
Best way to finance land + modular
Posted on 1/27/21 at 9:33 am
Posted on 1/27/21 at 9:33 am
I've come across a good deal on some investment property.
3 acres in an area that averages 15-20k per acre for $40k.
It comes with an older but remodeled mobile home that i could immediately make a rental, included at no cost.
Issue is, i only have about 12k cash on hand and everywhere i have called either wont finance land or won't do it with no permanent foundation on the modular.
I can do two small personal loans around 18K each and get the cash but it's looking around 7% for 36 months if I do.
Are there any other options? I can afford the $1000-1100/month on the two loans over 36, just trying to save myself 5-6K in interest.
TIA
3 acres in an area that averages 15-20k per acre for $40k.
It comes with an older but remodeled mobile home that i could immediately make a rental, included at no cost.
Issue is, i only have about 12k cash on hand and everywhere i have called either wont finance land or won't do it with no permanent foundation on the modular.
I can do two small personal loans around 18K each and get the cash but it's looking around 7% for 36 months if I do.
Are there any other options? I can afford the $1000-1100/month on the two loans over 36, just trying to save myself 5-6K in interest.
TIA
5
Posted on 1/27/21 at 10:15 am to Gusoline
that's a cash property. No bank wants to lend money on modular(mobile home) and land as an investment proprety.
Posted on 1/27/21 at 10:21 am to Gusoline
I have called around for a client and no one does it on investment. We can do it if you own the land and it is a primary residence.
Posted on 1/27/21 at 10:22 am to Gusoline
We are in same boat right now with some rural investment property. Only difference is it has a teardown house on it. You won't get great interest rates on something like that as the banks consider it speculative. If it is rural, you may have better luck with a bank that specializes in rural properties. Around here that would be Farmers National Bank. We are figuring on putting down 50%. Put enough money down and the bank will actually hope you default on the loan.
Posted on 1/27/21 at 11:19 am to Gusoline
This may not be the advice you're looking for, but find a partner. There are all kinds of people out there with money set aside not doing anything for them, but they don't have any deals.
Do some networking, and reach out to friends and family that may be in this position and ask them about it.
Since they're providing the capital, it may be worth sweetening the pot for them, offering 2/3 of the cashflow, or 50% of the profits if it's a flip.
That's if your partner is funding the deal as a silent partner. There's always the option of using a private money loan. Essentially, asking the same group of people, but it'd be a high-interest (10% or so) loan that you'd borrow from them until your deal is completed and refinanced.
Do some networking, and reach out to friends and family that may be in this position and ask them about it.
Since they're providing the capital, it may be worth sweetening the pot for them, offering 2/3 of the cashflow, or 50% of the profits if it's a flip.
That's if your partner is funding the deal as a silent partner. There's always the option of using a private money loan. Essentially, asking the same group of people, but it'd be a high-interest (10% or so) loan that you'd borrow from them until your deal is completed and refinanced.
Posted on 1/27/21 at 11:35 am to Sev09
quote:
This may not be the advice you're looking for, but find a partner. There are all kinds of people out there with money set aside not doing anything for them, but they don't have any deals.
This.
It's a cash property and many people are willing to invest.
Posted on 1/27/21 at 11:55 am to Gusoline
Can you do a HELOC or Refinance on your primary? Pay it down and then refinance or whatever.
Here's something to consider though, if you have to refinance it you'll have to refinance as a second property which your rates will be higher and then you may have closing costs. That's going to eat up a lot of your savings.
I'd look into a commercial or portfolio loan from a bank first, talk to a local banker or mortgage write that does commercial or land loans.
Here's something to consider though, if you have to refinance it you'll have to refinance as a second property which your rates will be higher and then you may have closing costs. That's going to eat up a lot of your savings.
I'd look into a commercial or portfolio loan from a bank first, talk to a local banker or mortgage write that does commercial or land loans.
Posted on 1/27/21 at 6:39 pm to baldona
I just need to look at it as a 46k purchase which is still an awesome deal instead of 40k and 6k iterest.
Sometimes ya gotta risk it for the biscuit. Possible snow tomorrow so if i get out of work I'm gonna go check it out and then have my realtor friend look at all the permits and such.
Wish me luck.
Sometimes ya gotta risk it for the biscuit. Possible snow tomorrow so if i get out of work I'm gonna go check it out and then have my realtor friend look at all the permits and such.
Wish me luck.
Posted on 2/2/21 at 11:05 am to Gusoline
Any update on this? We found out from our local bank that we do most of our business with that they will only do land loans up to 10 acres on the personal side of things. Anything over that is through their business side of the house. We are working through that now, but also looking at some other local banks as I've been told there are a few that specialize in rural properties. We just don't have any existing relationship with them.
Posted on 2/2/21 at 11:43 am to MadDogs
@MadDogs I'm a local lender here in BR and can probably help you get this property financed, depending on the acreage/loan size. We specialize in rural real estate.
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