Refinance Land?
I am confused, I own 20 Acres of land that I owe $27,000 on. I want to pull out 3 acres and have it free and clear. And refinance the 17 remaining still owing the $27,000. Speaking with a local Real Estate agent he says the appraisal should fall between $70000-$80000. My problem is the bank its financed with wants $8000 to release the 3 acres.(They have been bought out since I originally financed it with them and been very difficult to deal with since). I spoke to other lenders and have been told that since this is investment property I will have to prove my income(I need a stated income loan). My credit scores range from 686 to 729. I have enough cash to pay the loan off but I would only have about $10,000 left and being self-employed thats a lil scary. My bank offered me a credit card of $25,000 or a personal loan for the $27,000. How can I get a cc for 25k but not borrow 40% of the value of the land and they get the deed? Am I missing something?
Public Comments
- Banks don't like to loan against vacant land. Period. And when they do loan against vacant land, they normally want much better (lower) LTV than for a house. It's quite normal that they want a release fee for a partial release - the assumption is that you are pulling out the valuable part, and leaving them with an inferior lien. I don't know of any bank which will release a portion of vacant land without some major payment of principal. I would take the credit card line of credit at $25K - and don't run it up much. It will improve your score. Then if necessary, pay the release fee, and you will still have $10K plus $19K (from not paying off the whole $27K), for a total of $29K cash in the bank, and and $25K of available credit. That should hold you. You will continue paying on the land loan - which will also help your credit - the longer it's paid on time. I'm in a similar position - at about those levels.
- Just get a personal loan. These guys will help.
