Do you think we could get financed?

[Harley]

OK, my wife and I had built a new home about 5 years ago. The contractor did a very poor job building the house and we had alot of problems. He ended up filing bankruptcy and out lawyer advised us to do the same - the house was literally falling part.

It has been about three years now since our BR has been discharged and our credit is slowly getting better. I think mine is right at 600 and hers is around 640. We have had some loans on our vehicles without any problems (except high interest rate).

We are wanting to either have a manufactured or modular home put on our land. We own 5 acres of ground clear & free. The land is valued at about $15000 an acre due to where it is and how nice it is. I am curious if you more experienced people would think we would qualify for a a mortgage to have a home sat on the land as well as the septic, driveway and all utilities put in. Do you think it's possible to do this AND with a 100% mortgage and no money out of pocket (with them using the land as collateral?

We are located in Indiana. Any advice on a good dealer in Indiana?

Thank you

[rmurray]

Jeez...I did not know folks had this kind a problem with "real houses"...Sorry for your misfortune...From what you have said you will have no problem buying a manufactured home with FHA finance....Or off frame modular with any of a number of conventional mortgage programs.....Find a dealer/builder skilled in mortgage finance..You should have no problems....Get up to speed this time in advance...Visit the bookstore here and invest in one of the great buyers guide here...Do not repeat any of the mistakes of your last house buying experience...

Good Luck...Start soon while interest rates are still affordable...Your rates on these kind of mortgages should not be elevated because of the BK..Current FHA rates are being quoted at about 6.75% and A- credit conventional mortgages at about 7%...GO FOR IT...

[Kris]

I'm sorry this really has nothing to do with your post, but in Indiana the land is only $15k per acre or was that a typo? I am in California.

[Harley]

Thanks for the info. Will I need to go through FHA to obtail a loan on a manufactured hom since I am using my land as collateral? I'm hoping for a no out of pocket loan.

Land around here goes for about $5000 an acre if it's good land, real hilly or land way out in the middle of nowhere goes for around $2000 or so. My land happens to be in a prime location and the land that borders mine, but isn't even as nice as my land, sold for $35000 a 1/3 of an acre but this price was after all utilities had been installed.


I just got off of the phone with South West Funding. Does anyone know anything about this company? Any good?

The guy I spoke to told me that my father would have to gift the proprty to me instead of selling it to me for a $1 because if he sold it to me for $1 then that is all they could value the land at is $1. What do you think about this?

[rmurray]

As a manufactured home..you would have to finance FHA....But FHA can be done with no cash out of your pocket...The home price can be raised to cover up to 6% of closing costs...

The broker gave you some good advice....If your dad sells you the property for $ 1.00 both FAH and most conventional will not consider the value of the property as equity...Then you would HAVE to pay the required down in cash (3% in the case of FHA)...Most A- conventional lenders would require you have the property in your name for 6 months or longer to count the equity..Some will accept gifted property without seasoning...meaning right away when you get it...FHA and others who do count gifted property are sticklers on the exact wording of the transfer...It would be best for the closing attorney handle the deed transfer...FHA will allow down[payment assistance programs...To offset the required down payment..

Once you are fully 3 years from the BK some of the traditional manufactured home lenders will do this loan...Examples are Country Place Mortgage, US Bank..21st century Mortgage, Vanderbilt Mortgage and Origin...For the most part these lenders deal ONLY through the dealer..These lenders might have slightly higher rates...but lower closing cost and usually no escrow and no PMI (also called MIP).You might find some here in the lending section of this web site..This is another reason to find a dealer skilled in finance...Most of these lenders will allow credit for gifted property as equity to be used toward down...

Before I gave this broker any money..I would find a skilled dealer....One especially skilled in finance...Hopefully he/she will have a home at a fair price to suit your needs...

[Kris]

Murray, do you know how long this process usually takes (the gifting of the land), and do you need an attorney for this process? Are the laws different in California? I've been searching and don't know exactly which words to use in order to get the information that I need. The reason is is that the land we are on was a relative's and it is already subdivided but one part of the land with the dwelling still has a mortgage on it and the other does not because there is no dwelling. The relative was older and "talked" into taking out a mortgage on the home. So now we are paying it but it is not in our name. However we were told by the other relative that has the deed that they would have to "will" it down to us (me and my husband). I can't find any information on this. I have Grissim's book but I don't recall reading about this aspect of it.

Also my husband told me that when we are ready to get the house that the relative "will" it down to us. But I don't think that is correct information. It just doesn't feel or sound right to me. But he insists that this will happen. I beleive taht the piece without the dwelling should be turned over in our names. We are paying the property taxes and doing the upkeep. But I have spoken with a friend who is in real estate and she said the only thing we have to do aobut the mortgage aspect is get financed in our names. My husband believes this will keep us from getting the manufactured home that we want. By the way we are in a stick built home that is older and talk about your problems!!!!!!!

If you have anymore info. please email me at [email protected]

Thank you for anyinformation you may have.

[rmurray]

Technical legal advice..especially about real estate should be gotten for a local attorney skilled in real estate law in your state..

Your live relative cannot "will" property to you for you to mortgage..Your live relative would have to die before the property would become yours to do with what you please...Since your relative was conned into a mortgage he did not want..I would NOT be surprised to find the empty property also tied to this loan...Agian..good legal info on real estate, probate and local laws should be gotten from a knowledgeable attorney..A few dollars now might well save years of time and thousands later...Your relative if he is of sound mind could quit claim his property to you now...At least you would have a legal claim on the property...Probate fights can be messy and complicated because they involve other relatives...

If your relative has a mortgage that started with Ameriquest Mortgage you might be in luck...CA and other states have taken them on for deceptive mortgage practices involing older folks...There has been a large settlement of a major case in the last few weeks..If this is hs mortgage company..It would be worth checking out..

You can see an article on this here..

http://www.latimes.com/business/la-fi-a ... s-business

[rmurray]

The gifting rule I mentioned are lender rules NOT state laws...Most lender who accept gifted land for equity require the land be owned for a period od time usually 6 to 12 months...The wording agian is lender rules...If the wording looks anything like a sale...equity cannot not be used for a long time....

The lender term for this is "seasoning" of the land...Of course if you were to inherit the land you cna use it as soon as it is yours for the equity of your mortgage...This is not considered a gift....

The best palce to learn about mortgages on the net is here

http://www.mtgprofessor.com/

The site is understandable and compehensive...

[David Oxhandler]

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[Cindy]

Yeah LOL I was wondering the same thing myself... $15,000 per acre...???? I'm California, too, by the way. If only land was that cheap here...