Hudson, OH · Member since 2015 · 2 posts · 0 votes
I'm looking at buying my first rental property and need advice. I have the cash for a down payment and have been told the properties that I'm looking at do not meet Fannie's criteria. They both are in decent shape and cash flow well. One is a fourplex and the other is a duplex with a single family home on the same lot.
What are my options and what would you do if you were in my shoes? If you can break it down "Barney-Style" I would be appreciative!
Lender · Morrisville, NC · Member since 2015 · 610 posts · 131 votes
9y
@Joshua Morgan - Those deals are on the small side however I have worked cases like those as a commercial broker. I may be able to help you with options feel free to reach out to me.
Hudson, OH · Member since 2015 · 2 posts · 0 votes
9y
I was told that the purchase price was below their threshold. One property is priced at 64k and the other is at 79k. They also said the location of the property did not line up with Fannie standards.
Lender · Morrisville, NC · Member since 2015 · 610 posts · 131 votes
9y
@Joshua Morgan - Those deals are on the small side however I have worked cases like those as a commercial broker. I may be able to help you with options feel free to reach out to me.
Real Estate Agent · San Antonio, TX · Member since 2016 · 21 posts · 15 votes
9y
@Joshua Morgan I'm not sure why those properties would need to be non-conforming loans, but there are lenders that can provide those products. Generally there will be a higher down payment and/or rates.
Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
9y
Ah ok. Yeah, no such Fannie rule. But there are new compliance requirements introduced as loan amounts get smaller and smaller. Not really something I'm an expert at, to be honest (SF Bay Area...).
@Jerry Padilla what can you tell us about the additional requirements that come up with smaller loan amounts?
Wholesaler · Round Rock, TX · Member since 2015 · 31 posts · 10 votes
9y
Hi Joshua,
I am a residential investor loan specialist. Local banks can be tough - especially if this is your first deal. Credit and personal income come into to play very heavily. Fanny and Freddie are even tougher and have limits on total number of loans so that could be a dead end. I can discuss you best options once I know more about your deals. Price, location, s.f., rent roll, expenses are a start. I have some very flexible investors that can get these deals done for you.
The only issue I see is if there are no supported comps in the area, to support the number of units. They have to have comps to support an assessed value.