we bulit a home using credit cards and cash.no bank loans.we were insured by a broker financiing would be easy

Question

we were insured financing the house to rent it out would be easy once it was completed...so we went broke to complete the house..got the inspections and appraisals and than when ready to finance it...broker couldnt find any lender to funance it.
the more he tried the more the credit score went down...So now we have a house that is brand new..and it is just sitting...we are now waiting for sewer to be put in by city workers..waiting for them for months......we couldnt even rent it...we really want to finance it as a renter home and rent it out and take the money to pay off the cards and pay the land beside where we just built and build to sell,,,and this will set us up and our mothers......we are both self employed which is another down fall when applying for loans.....we also run into not living there....being a problem.....any advise woul;d be appreciated........we have been crushed in more ways than one..

Answer 1

Hindsight being 20/20 a construction loan would definitely be the way to go on this type of project.
The availability of loans for N/O/O (non owner occupied), self employed borrowers are a LOT less than they were a year ago. You should prepare yourself for the fact you might have to sell this home.
Realistically if you need more than 90% of the appraised value or have trouble verifying enough income using your schedule C from your taxes (assuming that's the type of tax return you file) then you're going to have problems financing this property right now.
You probably will need to make sure it is hooked up to public water/sewer as it sounds like it's feasible where the house was built before you finance it. AFTER that's done i'd tell you to go to a different broker, show him your taxes and ask how high of a LTV he can qualify you for. See how much of the credit cards and the other loans you can pay off with that amount of cash and see if it makes sense for you to hold on to the property at that point.
Something about a broker who promised you a program a year ago when he should have known the industry was changing seems either unethical or that he doesn't follow the industry that he works in very closely. Either way, I wouldn't feel comfortable working with someone that did that.
Also there's really no reason he should keep checking your credit. Any broker should be able to take a copy of the credit report he initially pulled when he first started shopping for your loan and obtain a pre-approval from a lender BEFORE they pull another copy of your credit. If he has half a dozen lenders pulling your credit before they ok the loan he's really not acting in your best interest.

Answer 2

what you want is a commercial mortgage. In the present market, it is going to be difficult to get one because all the usual lenders are scared that they've done a dumbness or fifty-three thousand of them [which they have] and they don't want to do any more dumbnesses.

So you are going to have to present a very conservative deal that looks like stuff they've always done.

I suspect the banks behind your credit cards might listen a little more carefully and be more inclined to do the deal.

They'll want the sewer to be in and occupancy certificate issued. Probably they'll also want an idea of the net rent you'll be able to command. [Ask them whether they want the lease signed before the loan goes on or afterward.]

Likely terms will be that the total payments [P, I, T, I] will have to be less than 90% of the net rent and that the loan period can not exceed 25 years. Expect to pay at least 7% APR in today's market. The loan will have fixed rates and there will have to be at least 20% equity [as determined by appraisal] in the property, perhaps 30%.

***
In retrospect, what you needed was a construction loan from a lender to finance the building process. Then the same bank would probably have made the mortgage after the job is complete.

After you get beyond this, that's the way to go on your next building project.


GL

Answer 3

Maybe when you started this project, funding was easy to find, but not now.

I suggest you sell it. Take the proceeds, pay off your CC debt and if there is anything left, do this all over again, but with a construction loan.

Answer 4

Banks regularly save their mortgages and do each and all the servicing themselves. the biggest income to that is having a guy or woman you may honestly pass to in case you ever have issues or desire the rest. It additionally seems reliable to assist your community agencies, and can be great to have people who honestly know you working for you. on the different hand..... that's the biggest downside, too. in case you run into worry, you have all of us on the city understanding your enterprise enterprise until now you became it around. that is embarrassing. very own loan brokers do a great style of busines and could get you greater valuable deals interest-smart. they have greater creative financing suggestions attainable. the great downside is that usually those "creative" loans bite you interior the butt later. (Like hands, or Balloon money, or "interest basically" fee suggestions or Pre-fee consequences.) study heavily each and every grant you get. Ask what that is going to value you in case you pay this very own loan off early. Ask in case you pays it off early with out penalty or with out dropping funds. Ask once you may refinance it--ought to a greater valuable deal come alongside later. (each and every so often you'll be able to desire to attend a pair of years or pay huge dollars.) lead them to clarify each and every thing, whether they get extremely annoyed. (in the event that they do, locate yet another very own loan broking service.) yet another downside of brokers is they hardly, if ever, service the loans themselves. which means you will have your very own loan offered lower back and lower back lower back--interior the direction of the existence of the non-public loan--to servicing agencies. that is extremely stressful to you. One month you pay the fee to XYZ business enterprise, the subsequent month you pay it to ABC business enterprise in yet another state. some agencies are greater valuable than others, too. some have not got genuine human beings answering the telephone--basically recordings. some are in states you have in no way heard of. some value $50 late costs, and a few value $20 late costs. that is nicely worth it to apply a broking service in case you get an exceedingly reliable deal--yet once you don't get a greater valuable deal than the financial company, pass with the financial company.

Answer 5

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Answer 6

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Answer 7

built a home using credit cards? what were you thinking?

Answer 8

sell this house