Canadians Buying US Property Have Financing Options – Even With REO’s
Seller financing is a great way for foreigners to pick up property in the U.S., as getting a traditional loan can be even tougher for them than us nationals. Usually seller financing is only applied to non-corporate owned properties (i.e. anything besides short sales or REOs), but there are some options when it comes to bank owned properties. I recently got this email:
Just read an article about Canadians purchasing property in the US and saw your name.
We want to buy a 2nd home in Palm Springs that is owned by the bank. Unfortunately in this situation we cannot get the vendor to finance. We have a great credit rating. Can we get a mortgage? Look forward to hearing from you.
How much of a down payment could you put down? And what is the purchase price of the property? Would love to help if I can.
This property was purchased in 2005 for around 1.7 and the owners did a real number on it. Then they rented the property and tried to sell it for around 2.6. The bank foreclosed and it is soon to go on the market. We know the current market value of the property is 1.4.
We were hoping to put down 10-20% and are hoping to purchase it for less than 1 million. We have owned a condo in Sandpiper, Palm Desert for around 10 years. It has a mortgage. We have a great credit rating. Hope you can help.
If you can acquire the property for that much below market value, then you may be able to get a private money loan if you put the 20% down. You could refinance out of the 12% loan at your earliest opportunity once the lending environment supports it.
Alternatively… we may be able to get a private investor to purchase the property, taking title in the name of a land trust, and then beneficial interest would be transferred to you. Obviously, your purchase price would be higher than the price the investor would pay to acquire the property to create some profit in the transaction for the investor(s).
For instance, investor buys it for $900K cash, and then ‘sells’ it immediately to you for $1.1mil through a land trust, carrying the financing for you, that would last for 5 years or so.
To pursue your hard money options, contact Steve Aranda @ 323.868.6242. If that option doesn’t look feasible, then let’s explore option #2.