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Anyone have advice on finding a mortgage type loan on an Agricultural property? It is a horse farm in Florida. A manufactured  home with a permanent foundation, fee simple. Owner has a personal loan from a friend at 0% for $70K with associated lien against the property. However she has also amassed a lot of credit card debt, and could benefit from a HELOC type loan if that exists for this type of property? She’s not having any luck, I thought maybe someone here would know what she needs to do! TIA

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It would help to have some numbers here to quantify the problem.

 

Even if this was a suburban tract home with a traditional first mortgage, she'd most likely be limited to 80% combined LTV (first mortgage balance plus HE loan or line, divided the current home value).

 

Hard to say if that would be worth pursuing without knowing if even the best case scenario would yield enough credit to cover the debt (which is also an unknown amount). 

 

And then there's the issue of whether the root cause has been addressed.  A lot of people who do consolidation loans or pay off consumer debt with home equity just end up charging the cards back up.

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Sure!  As I mentioned there's a lein for $70k but she's paying 0%, She does have almost $40k in credit card debt some of those cards at 25%. The property is valued (granted by Zillow) at $249k, so probably would appraise for less... Are you familiar with Agricultural loans in FL? Is a HELOC even possible?

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3 hours ago, d2w5 said:

Sure!  As I mentioned there's a lein for $70k but she's paying 0%, She does have almost $40k in credit card debt some of those cards at 25%. The property is valued (granted by Zillow) at $249k, so probably would appraise for less... Are you familiar with Agricultural loans in FL? Is a HELOC even possible?

 

I am not at all familiar with how to get financing for this type of collateral (manufactured home OR agricultural property, much less both), I just wanted to make sure that if everything else aligned that there was sufficient equity to solve the problem.

 

If I was in search of such financing, I'd contact some local community banks or (gasp) credit unions in the area to see what options they offer.  

 

At the same time, I'd pause for a long, long time and check out virtually every other option before recommending that someone convert $40k in unsecured debt into a second lien on a primary residence.

 

5 hours ago, cv91915 said:

A lot of people who do consolidation loans or pay off consumer debt with home equity just end up charging the cards back up.

 

 

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Another thought...

 

I think she'd have a better chance getting a first mortgage on this property (essentially a cash-out refi) than a home equity product.

 

In order to do this the current noteholder would need to be paid off with the proceeds of the first mortgage (and the existing lien would need to be removed), or the noteholder would need to sign a subordination agreement putting him/her in second lien position.

 

[fwiw, if I was the current noteholder I would never, ever, ever, put myself in second lien position, but then I'd also never make a risky $70k loan at 0% either.]

 

I think this idea is more likely to present options, but it's also more perilous because if a first mortgage is foreclosed she'll have nowhere to live.

 

Why can't she just cut expenses, rent out a room, get a second job -- and just pay off the debt? 

 

 

Edited by cv91915
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She is in a position of realization (as many of us have also been - myself included) that credit cards are not the way to pay for say a new roof...however now that she has already made mistakes, I was reaching out here on this board as it was SO helpful to me when I was in trouble. Trouble which I have recovered from I might add. thanks to the broad reach of experts on this forum!

So, I am still wondering if anyone has specific knowledge of Agricultural Property loans, as I am seeing that there are not many banks that do, and they simply do not make those loans in their portfolios.!

Hoping someone on these boards might (fingers crossed) have knowledge or experience with this particular challenge?

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