Buying a house in new location when doing a business asset purchase

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by a searcher from Baruch College-The City University of New York - The Zicklin School of Business
in Red Bank, NJ, USA

1yr ago

Buying a house in new location when doing a business asset purchase

For those who move to buy a business and have a family, do you typically rent in the new location? I would think it is difficult to get a mortgage without documented income (since most people do business asset purchases). If anyone has ideas, curious to know how it would work to buy a home with a mortgage when doing a business asset purchase,

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reply by an intermediary 1yr ago
from Wake Forest University in Winston-Salem, NC, USA

You hit on an often unspoken challenge faced by relocating buyers -- if they weren't a business owner before, other than a portfolio mortgage (meaning a non-Fannie/Freddie loan that they aren't going to sell on the secondary market) with a lender you have an established relationship, it is very hard to get a mortgage given the rules around being "self employed" which generally require a 1 or 2 year track record. The larger rental property management companies can be equally as challenging as they almost all use credit models now with very little user common-sense input. I had a buyer who had credit score over 800, buying an established business, and cash in the bank to cover the loan, that could not get a mortgage and struggled with finding a place to rent -- they ended up renting from an individual.

reply by an investor 1yr ago
from University of Wisconsin in Chicago, IL, USA

It's better to rent initially, but when it's time to buy there are lenders that do 12mo bank statement loans. It's best to work with a mortgage broker that can reach out to several different banks. DM me if you want a connection to the person who worked with me.