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Updated almost 6 years ago on . Most recent reply

User Stats

135
Posts
174
Votes
Pavel Shemyakin
  • Rental Property Investor
  • California
174
Votes |
135
Posts

HML for buy and hold.

Pavel Shemyakin
  • Rental Property Investor
  • California
Posted

Good afternoon my fellow BPers! Hope everyone's day is going great!

I know that it is common practice to use HML for financing flips, but what are the draw backs of using HML to get favorable pricing on a buy and hold then refinance to traditional financing right after?

For example, if i have 20%-25% down payment ready, and qualify to get a traditional 30y fixed, could i theoretically close with HML, get favorable pricing due to it being a cash transaction, then immediately turn around and refi?

Is my logic flawed?

Most Popular Reply

User Stats

156
Posts
98
Votes
Herndon Davis
  • Lender
  • Ft. Lauderdale, FL
98
Votes |
156
Posts
Herndon Davis
  • Lender
  • Ft. Lauderdale, FL
Replied

HML have intentionally high interest rates, high points, interest only and are short term 6 monthts to a year.

Not sure where the advantage is 

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