Thread: Is my property worthless because of the banks?

[FONT=Times New Roman][SIZE=3]I have a situation that I need some ideas on

This is a great lesson for all the new investors out there -
Invest in property with the biggest potential market of buyers & check with your mortgage broker & appraiser about new buyers being able to qualify for financing, especially if you are going to make any changes to it.

Mobile homes, pre-fabs, 'unique' homes; great if you are going to live there forever, if not...ummmm

In this case I would think you may find a lender to loan on it as a lot as it is considering the value of the land.

I have lived in this house for almost 13 years..... I remodeled it 3 years ago to sale then found out it was a problem with the banks. If it would have sold 2 years ago when I first tried I would have lost my butt on it. Lucky for me the property values have sky rocketed tha last 2 years. Bottom line is I remodeled a worthless house. I would absolutely love to take a track hoe to this thing, it has been a huge source of anxiety for me.

Well you have a mortgage now - won't your current lender offer financing to a new buyer - or at a long shot let someone assume the current mortgage?

We are working that now. I have over 100K in equity in the property so it was easier for me to get this house (refinanced 2 yrs ago). These people have little to put down. The lender (my current mort compnay) says they will do it if they can get a second somewhere else. It all just sounds too far fetched to me. I may just bury the house with dirt and say the property has a cool sleigh riding hill on it.

Yeah, I think a second mtg would be way out of the question, however they may qualify for an unsecured/ secured personal loan that will give them some extra cash?

Well accidents do happen, hope someone doesn't accidentally bulldoze it for you

Originally Posted by oh-crap

I have lived in this house for almost 13 years..... I remodeled it 3 years ago to sale then found out it was a problem with the banks. If it would have sold 2 years ago when I first tried I would have lost my butt on it. Lucky for me the property values have sky rocketed tha last 2 years. Bottom line is I remodeled a worthless house. I would absolutely love to take a track hoe to this thing, it has been a huge source of anxiety for me.

I actually work in an area with a lot of manufactured homes and some have had the same issue... one way we have gotten around it - you may have already done and do not know.... there seems to be two big obstacles if you can get this certified sometimes lenders will lend... #1 has the wiring been updated #2 does it sit on a foundation or concrete runners.

If you have done those two things you can pay for a HUD certification and possibly get a lender to bite...

Let us know -

The other thing is start marketing it to someone that would buy it (cash) - use the house for a rental for a while - then remove the home and sell the land... I get a lot of those buyers too.

The problem you are encountering has nothing to do with the individual lenders or banks. Lenders have to sell their loans on what is known as the secondary market so they have the money to loan out again...otherwise they would run out of money at some point. By far, the largest purchaser of loans on the secondary market is Fannie Mae and that's who calls all the shots. Fannie Mae WILL NOT purchase a loan on a manufacured home that was built before the HUD Code went into effect on June 15, 1976. Prior to this date, there were no regulations governing how manufactured homes were built....no fire code, no electrical code, etc. Back then we called them trailers, and quite often the hitch and axels were never removed and the perception was that they were mobile...hence the term mobile home. In fact, at the time the HUD Code was put into effect, manufacured homes were not even considered Real Estate....they were considered personal property like a car or boat Fannie Mae requires several things in addition to a date of manufacture later than June 15, 1976. In order for Fannie to buy a loan of a manufactured home it MUST be tied down to a permanent foundation, hitches, wheels and axels MUST be removed, and it MUST meet minimum size requirements.
It's easy to understand why they don't want to buy loans on structures that were built with absolutely no codes or regulations...there's just too much risk there.
Is your home worthless? NO
Is almost all of your value in the land? YES
Think about it this way....you say the prices have skyrocketed recently...but all the while the structure itself has been depreciating much like a car would...it stands to reason that any appreciation you are getting is soley from the land. At some point the structure itself will be worthless or even worse, a liability...as it costs money to remove an old structure....
There are options available to you:
1)find a cash buyer....but people with that kind of cash typically aren't interested in an old manufactured home
2)offer owner financing if you can afford to
3)find a buyer willing to get a loan from a private source(most mortgage brokers know of a few sources of private money for deals that don't conform to Fannie Mae guidelines) but remember Guido from Miami charges 20 percent and he visits late payers with a baseball bat
4)find a buyer who can get a vacant land loan...they don't usually require old structure be removed from vacant land unless they are dangerous
5) find a buyer who can get a construction loan...deals like this are done all the time where an old manufactured home will be removed in the future so that a new one can be placed there

Another option for you would be to get a loan yourself from the built in equity and place a larger home there that better suits the needs of your family

Sorry for your trouble....but as you have found it is almost imposible to sell property if the banks won't loan on it....I see it all the time