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Will a bank give me a loan if I put up a deed on my property and I know they won't give me a loan with just my credit?

  • Your best bet is to talk to a banker. It all depends how poor your credit is now, your income, and the condition of your paid for property. They may be willing to finance you, but at an interest rate you find unacceptable. It all depends on many different factors. – Pete B. Nov 3 '16 at 11:52
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Will a bank give me a loan if I put up a deed on my property and I know they won't give me a loan with just my credit?

If I understand this, you already have a full paid house/property in your name. If so yes you can use this as a collateral to get a loan on the new property you are looking to buy.

Depending on the values of the current property and the property you are looking to buy, they may still run credit checks and ask for proof of income to establish that you would be in a position to repay the loan.

Edits
If say the current house/property is valued by the Bank as $250K. The new house/property you are buying is say $150K. You can take a HELOC on first property and use this to buy the second house. Or you can put a lien / collateral as the first house and buy the second. If you default, the first house will be possessed by the bank to get their money. This would be advantageous if you are looking at selling the second house in short term as the entire sale will be less complicated.

If say the current house/property is valued by Bank at $250K. The new house/property is at $300K. You don't have 20% equity to pay [or whatever the Bank insists]; you can put a lien on your fist house as well as second house and get a loan of $300K. In case you default, bank would re-posses both the house and auction it to get their due back; if you have already paid substantial EMI and then default, Bank may only put one house on the block to recover their dues.

  • ...But there may not be any advantage over taking a normal mortgage in which the new house serves as it's own collateral. – keshlam Nov 3 '16 at 14:37
  • What happens if the loan is defaulted on? Which property would the bank repossess? – Freiheit Nov 3 '16 at 15:03
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    @Freiheit See edits. – Dheer Nov 4 '16 at 3:58

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