|Never had a mortgage loan..|
|Posted by: Rick Apr 21 2003, 12:22 PM|
|I hope I did this right concerning topic settings etc. I have written lenders for advice and rarely if ever get a responce. I won’t venture to discern why as it would probably distract from the real interest here.|
I purchased a property cash. A small duplex and its rented. Located in the NY Buffallo area. I do not owe a mortgage. I have the place insured and managed by a professional company. I want to borrow against the property to purchase another duplex or 4 plex. What sort of loan should I look for? I also have cash to put in towards the next property but not enough to pay it in full as before. I want to preserve a reserve of cash in case of emergencies. I have only possessed this property for 3 months.
I have never had a mortgage loan and never applied for one. There are just so many choices and before I apply I want to make sure I am applying for the right type of loan. I am really a layman in this arena so keep it simple
Thanks in advance
|Posted by: loanuniverse Apr 23 2003, 06:25 PM|
Your question is an easy one. Taking into consideration that your first property is paid for, then all you need to do is apply for a term-loan on this property to obtain the money for the down payment of your next purchase. The loan would be what is called a cash-out loan in the industry. One good thing that just crossed my mind while writing this is that you can even keep the costs of financing down as the bank might accept a regular residential appraisal, which costs about $250 instead of a commercial appraisal, which runs around $1,500. The problem that I see is that doing small loans like these are not very profitable. However, contacting small community banks in your area are your best bet. Eventually, you will find a banker that is willing to work with you.
The thing that you have to remember is that this loan is not a residential mortgage. You will be applying for an “income producing property loan” I am assuming that you do not live in the duplex . You can get an idea of how the bank will analyze your request by reading this page.
If you want…… provide me with some numbers, and I will tell you more or less what you could apply for. I will need the following:
Utilities, maintenance and tax Expense
How much you paid for the duplex and when or better yet an estimated value of the property.
I hope this helps.