Before, I get started - yes, I googled and used the forum search extensively looking for an answer of the following question.
I purchased a property (high end area of major metro) for 600k and did some major rehab work, initially I wanted to flip it, but strongly considering moving into it now. The problem is that most of my liquid assets went into the rehab and don't have the money to throw down an additional 20% down if I'm forced to use auction price as the basis of a LTV calculation.
I know a lot of lenders will use either the 1 year, or even 2 year mark as the time they stop using the lesser of the appraisal and purchase price and just use appraisal. So, assuming it would appraise at 850k, does anyone know if Penfed would use appraised value or would they use the foreclosed price? Basically if I get to use an appraisal 80% LTV would work out to 680k. Say for a sec, that my bridge loan is 600k. Would I be able to finance 680k(80% of appraisal), 600k(maxing out at auction price) or 480k(80% of auction price)? As you can see, what penfed or another lender uses as the basis of LTV makes a huge difference. I'm not considering PMI as an option - if its that bad, I'm selling the place period - regardless of how much I like it(great school district etc)
I really love the house, but given the amount of money I put into it, it's really not feasible for me to chunk down an additional 120k if they use 80% of purchase price. If penfed is like every other lender, their going to ask me to start an app before I hear about the unwritten rule 2-3 weeks from now which is why I'm hoping someone here might have some insight. Also, if anyone knows a lender besides penfed that might do this please let me know.
Disclaimer: By providing links to other sites, FatWallet.com does not guarantee, approve or endorse the information or products available at these sites, nor does a link indicate any association with or endorsement by the linked site to FatWallet.com.
Members of our community may attach files to a post in accordance with the User Agreement. FatWallet is not responsible for the content, accuracy, completeness or validity of any information contained in any attached file. Files have *not* been scanned for viruses. Be especially wary of Excel files which may contain malicious content.
Earn Cash Back while you shop - just 3 simple steps.
1. Sign Up so we know who to pay! (It's FREE.)
2. Shop through FatWallet for deals from your favorite stores. Your online purchases earn Cash Back that builds in your FatWallet account.
3. Get Paid by requesting a payment via check or PayPal.
FatWallet coupons help you save more when shopping online. Use our Coupons Search to browse coupons and offers from thousands of stores, gathered into one convenient location.
As part of our FatWallet Community, you can share deals with almost a million shoppers in our forums. Forum content is generated by consumers for consumers. Share deals, money-saving tips, and more. It's FREE, fun, and addicting.
Our customer experience team is here around the clock - real people ready to assist.