Business Question

[actariq2]

Hello, my friend has a credit score of 708 and is 18 and attend college. He recently been approved of school loans and was wondering if it was that easy for him to get money for school could he get a loan to buy real estate? He has no assets but a plan to own real estate in a rising neighborhood. Do you think its possible for him to get a loan from the bank to approve his plan?

Thanks in advance

[jasaunders]

The short answer is NO.

[DavidJEastman]

There might be some mortgage brokers around here that can correct me if I'm wrong, but from my experience, student loans are probably the easiest loans to get. They don't really look for a long, solid repayment history or anything like that because, well, most borrowers of student loans can't have a long repayment history (being 18, usually). Your friend also might keep in mind that lenders base their decisions on more than a good credit score, but I couldn't get into specifics as I don't know much more about that process. You can check MSN Money for articles on getting real estate loans.

[Gaulkin]

Are you oblivious to the real estate crisis that just happened and is still going on?

[gregdavidson]

What kind of real estate is he planning on purchasing? Foreclosures?

[warrensway]

no not in our market

[rogercbryan]

3 years ago... maybe... today... not a chance.. the market has changed way to much

[conductr]

He's done good for a few months. They need proof he can pay the bills for the next 30 years. Unless he has huge income, which I am guess not since he is borrowing for school, they will not approve him.

[ChrisBenjamin]

Well it's beating a dead horse buy yeah, no.

[actariq2]

He was talking about foreclosure properties...real estate average in my state goes for 120,000..foreclosure goes for about 5k-20k..fix up to run a store or rent out to tenants..not a quick flip..but he thinking about long term investment...my friend was talking about banks will give u a loan if u catch a good deal on propery and the bank can see that if all else fails they can sell the real estate and recieve a large share of what is own.

[magma]

To represent to the new lender that things are AOK with the old properties and compel/induce the lender to make a new loan on a property with the express intention that after you get that loan the old properties are going to be either Shorted or just plain Walk Away is really, really a problem.....like loan fraud. We are not tolerating it and when we catch it and believe me sooner or later we will, well......we are not to happy with the situation. There is a SAR report filed and that can be very detrimental to anyone in the industry...that is a Suspicious Activity Report that is filed with the Treasury Department. The Feds can often and will more and more become involved in these matters as it is now the "new" thing....

It is considered confirmed material misrepresentation and they will act on it, so I do not advise that anyone consider doing it.

Do they catch everyone, no, but they are looking for it now as it has become epidemic and we are rather PO'd about it. So, do I like what the lenders did on these loans, no I do not, but can we continue to allow the excesses of the past that got us here? I have declined so many of these loans that were build on smoke and mirrors...and rightfully so it appears...we can not let this mind set continue, our credit markets are completely in disarray, we are verging on total recession and we are going there to the glee of the rest of the world with our high and mighty position that we have taken for so long....

So I do not support or advise the continuation of the issues that got us here in the first place.

[just1guy]

One optionfor him could be to find a property he could live in and fix up while in school. He could possibly qualify for an FHA loan with a smaller percentage down. After four years, if he gets it fixed up, he could sell it and make some money on it.