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Complex financing/refinancing question

Trying to buy an REO property.  I am veteran, pre-approved to $215K.  Current income is $70K, stable employment, credit scores in the 670's and have about $5K on hand. 

The bank that foreclosed on it for $343K in 2010 went out of business in 2012. It has been listed by the current bank for about 120 days at $210K.  Tax assessment is $415K, zoned CLD. 

During foreclosure, 2 houses on 2 parcels totaling 4 acres were combined into one. The "good" house will be my residence, and will have no problem passing the VA inspection. The other house can be re-habbed, but is not livable now. My hope is to renovate it later for use by my parents when they are no longer able to live alone, which I don't foresee for another 5-10 years.

The problem is the VA:  one house on one parcel. My current offer is $210K and they subdivide off the "bad" house with a minimal amount of land, I get a VA mortgage on the good house, and then they gift me the "bad" house at closing.      

We have talked to a wealthy friend who may try to buy it from the bank as a cash buyer, and we buy it from him. But that's the least desirable option.

Any other ideas?  Is a commercial mortgage an option with (1) little cash on hand and (2) no business use? Or a USDA mortgage?  It is in a USDA approved area, and my income just falls under the maximum for our county.
  • August 18 2013 - Southport
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Answers (1)

Profile picture for KristenRN
Anyone? I'd sure like some guidance. Thanks in advance.
  • August 19 2013
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