Jump to content

Looking for the best options for a condo loan


blurred
 Share

Recommended Posts

I need to apply for a loan to buy the condo I rent from my landlord for 110k.

I plan on fixing the condo up and selling it in the next year or two.

I'm looking for the best place to apply for the loan. Should I try my local credit union, bank, or is there somewhere online thats better like Lendingtree etc?

Also, since I plan to sell in the next few years (appreciation and sweat equity) would a interest only loan be my best bet? Thanks for any input.

Link to comment
Share on other sites

I need to apply for a loan to buy the condo I rent from my landlord for 110k.

I plan on fixing the condo up and selling it in the next year or two.

I'm looking for the best place to apply for the loan. Should I try my local credit union, bank, or is there somewhere online thats better like Lendingtree etc?

Also, since I plan to sell in the next few years (appreciation and sweat equity) would a interest only loan be my best bet? Thanks for any input.

Read a good article in New York Newsday for first time home buyers.

http://www.newsday.com/business/ny-bzmor305313397jul30,0,3316869.story?coll=ny-business-leadheadlines

My advise to you regarding going a bank or credit union. You will save on the rate and closing costs. But for whatever reason your loan doesn't close, you wasted your time and money. One of the advantages of working with a broker, if something comes up. They can submit your loan to another lender.

If you go through lending tree, first get your own copy of your credit report. Do not give out your SS#, only your FICO scores. I have seen credit scores drop because of too many iquiries.

If you really want to be a harda8-) s, say you want to order your own appraisal (in your name). Contact an appraiser who is licensed and has E&O insurance. Get your own appraisal done with the ability to change lenders. That way your not struck with one broker.

My advise to you regarding interest only loans, stay away from them. Why, you need to look at whats happening in Colorado right now. The value is not going up as it's been in the last several years.

As a minimum 3/27 or 5/25 arm, if not a fixed rate. Where something is going towards your principle (though on any mortgage, your going to be paying more in interest the first few years).

Good Luck...;)

Link to comment
Share on other sites

If you don't have a trustworthy broker, then give firstsource a try (on this site). Many members have been happy with his help. If it can be done then he'll do it if it is in your best interest.

IMO, except for very specific situations, stay away from IO loans right now. You'll pay a bit more interest and you can't count on appreciation to pay for closing costs at purchase, carrying costs, and then selling costs. You could find yourself making 60 on time monthly IO payments and then still be financially under water when you factor in the costs of a roundtrip (in and out of the property). With an amortizing loan, you'll at least pay down some principal and your rate will be slightly lower in doing so.

Regarding ARMs, I wouldn't mess with them. In today's flattened yield curve rate environment, the rate difference is negligible and not nearly enough of a difference to justify adding additional risk to your loan especially at your price point.

Link to comment
Share on other sites

Do NOT get an interest only loan.

Do NOT invest in a condo as a fixer upper (they are lawsuit magnets and generally do not appreciate as fast as detached homes).

Do NOT underestimate the value of your sweat equity.

Do NOT re-sell it before two years are up (although I would not buy into a condo in the first place).

Link to comment
Share on other sites

Do NOT invest in a condo as a fixer upper (they are lawsuit magnets and generally do not appreciate as fast as detached homes)..

I agree with your statement........

Just lately been watching the home improvement channel on cable TV, it's amazying how they buy propertys and flip them. They present it as so easy and trouble free.

.....:confused::shock::confused:

Link to comment
Share on other sites

Hey folks, I appreciate your input.

My situation is a bit different than most here in Colorado....however you guys at least changed my mind about a interest only loan. :lol:

Anyway, the condo I'm going to buy is the same one I've lived in for 4 years. I'm buying it from my landlord. It needs work, but my neighbors units sell like hotcakes. One good friend lived next door to me, renovated his and made a very nice profit. How long was it on the market? About 3 hours. :shock:

I live up in the mountains, in a ski resort town, so real estate is always appreciating here, and isn't really effected by the rest of Colorado.

I'll keep you folks updated.

Link to comment
Share on other sites

A broker would be the last place to go now... You want a lender that will still be around and funding when it is time to close. Go directly to one of the major players: Chase, Countrywide, Wells Fargo. They have the resources and the longevity to survive. I work for Wells Fargo and EVERY DAY there are stories of a lender that backed out 2 days before closing... or worse, clsoed a loan but did not have the ability to fund.

Link to comment
Share on other sites

I guess there are two ways of looking at most things. Lenders are changing their programs during the process. With a broker they will have several other places to take a loan to if the program from the lender gets dropped. If you are working with a direct lender: too bad.

There are lenders that work directly with the public that are also closing their doors every day. (American Home Lending, for retail: ABC same company for wholesale is an example.

To be REALLY safe ask your broker if the program that they have you with is either an FHA or a Freddie Mac or a Fannie Mae product. Those don't go away and if the lender goes out of the business there are lots of other lenders to take the loan to.

Of course these comments are very biased....

Charles

Link to comment
Share on other sites

...To be REALLY safe ask your broker if the program that they have you with is either an FHA or a Freddie Mac or a Fannie Mae product. Those don't go away and if the lender goes out of the business there are lots of other lenders to take the loan to. Of course these comments are very biased....Charles

Well said Charles.......:)

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
 Share

×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.. For more information, please see our Privacy Policy and Terms of Use.