Best option for poor credit but large down and reserves

[Marcus Welson]

I am looking to purchase a property in the $330-$340k range. 

I don't have income verification or returns available and my Fico Mortgages 5, 4 and 2 scores are 616, 560 and 621 at Equifax, Transunon and Experian respectively.

I have up to 180K cash for a down and $50k in additional reserves. My goal is to get a high likelihood of approval at 1 one year or longer of financing to allow me to refinance after cleaning up credit and completing some bookeeping/tax corrections to better qualify.

Property would be purchased through LLC based on a 1031 exchange where I completed the sale and now need the replacement property.

Can anyone suggest if the above is doable and my best options, other than seller financing which would be my backup request after I can show I can do the deal without the seller financing. Recommendations for any specific lenders would be greatly appreciated.

Thank you for your help in advance. 

[AJ Exner]

Hey Marcus,

I would imagine that there are some bridge (1-2 year term) Interest-only loans that I would imagine could get you close to 70% leverage and buy you some time to help bring the FICO up a little bit.

Otherwise, I always see DSCR loans as 'Asset-based, FICO-informed' so your credit will certainly play a role. The programs I know allowing for ~60-65% on a DSCR would have a higher interest rate as well (probably around 9.5%) with the standard 3- or 5-year prepayment penalty.

It would heavily depend on what you would like to do and how you would like to do it. It certainly is possible in a couple of different ways and having the reserves will help give you at least a few options.

Happy to connect and talk through it further if you would like.

Good luck!