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How to get a mortgage on a free and clear property that is not your primary residence?

My grandfather inherited a property 2 yrs ago when his wife died. He has since gotten the property in his name. The property is in NC and he lives in GA in an apt on a fixed income.He would like to get a mortgage on the property. What options are available to him?
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February 02 2012 - US
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Answers (2)

If he isn't living in the property, it will be very difficult for him to get conventional financing as a second home or investment property. Would he consider moving in?  If not, given that he owns the property free and clear, he should be able to get a private lender to make the loan.  We lend on transactions like this, although we always make sure the borrower has enough income to pay debt service.  Given that he is probably retired and needs his income, his best bet may be to find a tenant first. 

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March 15 2012

He would have to qualify with his income, assets, and credit if he wants to finance the property as a second home or investment property.  In other words if he wanted to continue living in GA.

He could get a reverse mortgage if he chose to move into the property as his primary residence.  There is no income or credit qualification for the reverse mortgage, but they are only available for owner occupants.

The really nice thing about the reverse mortgage is that there are no monthly payments.  The interest is added to the loan amount each month and he could stay there for the rest of his life without a mortgage payment.

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February 02 2012
 
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