New Condo Purchase Options

ernie1 · Joined: 28 Oct 2006 Posts: 2

Hi all,

New here. I have a 700+ fico. Looking at going stated. I have a friend overseas that wants to sell his $1.6M condo for $1M to me. I know it will appraise for around $1.6M. I'm not sure if I want to flip it or move into it for a year. My residence is around $1M with about $400K in equity.

My goal is to buy it using as much of the equity in the condo without having to refinance my current house. Assume I have $50K cash to put down.

I would like to try to set it up as a second home but may have to go as an investment property. For both scenarios how would you write up the contract (since I can increase the purchase price with a seller credit at closing) to accomplish my goals.

I was told that hard money lenders may give me all the money I need since they only lend on their appraised value of the property but at much higher interest rates. Any idea on what those rates would range from?

I appreciate your advice.

Thanks.

Mac · Joined: 04 Feb 2005 Posts: 276 Location: Knightdale, NC

I think you need to come to grips with what the home is going to be to you before anyone can really offer any help.

You covered the spectrum from owner occupied to second home to an investment property.

Hard money can range from 7% to 16% or more.

ernie1 · Joined: 28 Oct 2006 Posts: 2

Say I buy as an investor. Condo is in FL and on 10 flr.

Haplo · Joined: 20 Jan 2005 Posts: 2422 Location: Springfield, IL

Yee gods you're lookin for some hairy stuff on that one.

You're rarely going to be able to have it just 'gifted' to you so that you can be at a lower value. On an investment property, you're looking at even more difficulty.

There may be a lender out there that will allow you to use the actual appraised value, but in general you're going off of the price of the home not what it's actually worth.