This is referring to using a hard money lender. If the loan is 84k and the sales price is 69K can you get cash back to start repairs?
I recommend that you disclose this to the lender. Many lenders prohibit the practice.
If the cash is for repairs, the lender will probably want the money held by the title company in escrow, to be paid to the contractors as they finish the work.
June 26th, 2009 at 10:45 pm
I recommend that you disclose this to the lender. Many lenders prohibit the practice.
If the cash is for repairs, the lender will probably want the money held by the title company in escrow, to be paid to the contractors as they finish the work.
References :
My experience. Over 40 years investing in real estate.
June 26th, 2009 at 11:33 pm
Depends on the lender involved, but in many cases you can. You may need to provide estimates of repair costs needed, and may also be required to have the lender hold the monies in escrow, to be paid out only to the appropriate contractors involved.
Check with your lender.
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June 26th, 2009 at 11:56 pm
more than likely a new loan will be written so you can make repairs.OR the full price on the house will stand but a writer tacked on the loan showing where the money is going.YOU DON'T WANT TO BEING PAYING ON TWO LOANS.
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June 27th, 2009 at 12:32 am
If you do not tell the lender about it, then yes. Later, you will be arrested and put in prison for fraud. There are a few legitimate reasons to get cash back at closing. However, those reasons are very rare. It is often a RESPA violation and the closing agent will not knowingly participate unless the bank specifically says it it O.K.
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I'm a real estate attorney