We are in the middle (last few days before closing) of a property deal.This property is very profitable. It has a 4 bedroom house and 4 mobiles on it. All rented and very cashflow +. Will be even better after we are done.
We are dealing with a very naive vendor who is 50+ and still asks his sister for advice.
He had previously agreed to provide a Vendor Finance for the downpayment, then decided against it after he signed the agreement.
Keeping our cool, we said ok, no problem we will use our funds we had for renovations.
We have no problem getting a mortgage but require Mortgage Insurance. They need to have the mobiles on a separtate purchase agreement from the hoouse. No problem, we think. The vendor has to ask his sister. She is not sure it is a good idea, so he asks his lawyer and accountant and they think it might trigger a CG, which might adversly affect him. Yes it will also trigger a capital loss, and it will all balance out. The accountant is on vacation now until Friday.
My MB is talking to his lawyer, as he is an investor like us, and is knowledgible. Maybe he can clarify things some.
We decide to have a Plan B. We have a mobile that is "free and clear" and want to borrow $15K (about 60% of it's value).We go to our bank that we deal with. Unless we live in this mobile we can't. Well, it's a rental, and they will lend if it is owner occupied.
I showed her that we have $600K + in assets, then told her it's a shame we have to use a MB every time we need a mortgage, as our own bank will not lend to us, unless it is thru a MB.We got up and walked out.
This is 3 times we have tried, and it was our last, with our bank.
We are not willing to refinance another property and pay $1000's in legal and Lender's fees to borrow $15K.
If this Vendor wants to sell, he will need to grow some b*lls.We have already signed 2 of his tenants for him (as they will be ours, maybe) for more rent than he was charging.
We are dealing with a very naive vendor who is 50+ and still asks his sister for advice.
He had previously agreed to provide a Vendor Finance for the downpayment, then decided against it after he signed the agreement.
Keeping our cool, we said ok, no problem we will use our funds we had for renovations.
We have no problem getting a mortgage but require Mortgage Insurance. They need to have the mobiles on a separtate purchase agreement from the hoouse. No problem, we think. The vendor has to ask his sister. She is not sure it is a good idea, so he asks his lawyer and accountant and they think it might trigger a CG, which might adversly affect him. Yes it will also trigger a capital loss, and it will all balance out. The accountant is on vacation now until Friday.
My MB is talking to his lawyer, as he is an investor like us, and is knowledgible. Maybe he can clarify things some.
We decide to have a Plan B. We have a mobile that is "free and clear" and want to borrow $15K (about 60% of it's value).We go to our bank that we deal with. Unless we live in this mobile we can't. Well, it's a rental, and they will lend if it is owner occupied.
I showed her that we have $600K + in assets, then told her it's a shame we have to use a MB every time we need a mortgage, as our own bank will not lend to us, unless it is thru a MB.We got up and walked out.
This is 3 times we have tried, and it was our last, with our bank.
We are not willing to refinance another property and pay $1000's in legal and Lender's fees to borrow $15K.
If this Vendor wants to sell, he will need to grow some b*lls.We have already signed 2 of his tenants for him (as they will be ours, maybe) for more rent than he was charging.
That's a classic! You can just imagine the bright spark in the bank who came up with that one! Maybe you could first do a balance transfer to a credit card with this Bank, alongside an agreement that said this new card account would be closed once the refinancing occurred? Can't see another way out of it unless sanity prevails!
