Portfolio loan/ single asset rental loans

4 Replies

Hi BP

I'm at a point where I'm unable to do traditional financing because my DTI is high and close to having 10 loans in my credit report. Currently my business is stagnant due to having limited capital. I'm actively learning about portfolio and single assets rental loans and hoping this will help me take some equity out and continue to buy. So far I have this term sheet quote from a commercial lender. Can you take a look at it and provide me some pointers or help understand which term makes more sense?

Emerald 30 Year Fixed Calculator

Property Value/Purchase Price: Address, City, State

IO Term

Borrower Track Record

Borrower Basis (if Refi, Purchase + Rehab Spent) Cash-Out (if Loan is greater than Basis) Borrower FICO

Annual Taxes

Annual Insurance Premium Monthly HOA Dues

Monthly Gross Rental Income

Loan Amount Starting Rate Non-LTV Adjustments Final Rate

Monthly Principal And Interest Total Monthly Expenses Monthly Cash Flow

Property Debt to Income

$ 1,355,000

Fully Amortizing

4

$1,234,000 No

720

$ 16,938 $ 4,743 $-

$ 11,525

$

$ $

60% 813,000.00

6.75% 0.000% 6.750%

$778.32 949.15 500.85

65.46%

$

$ $

65% 880,750.00

7.25% 0.000% 7.250%

$886.83 1,057.66 392.34

72.94%

$

$ $

70% 948,500.00

7.25% 0.000% 7.250%

$955.05 1,125.88 324.12

77.65%

*properties owned or flipped in last 36 moths

Benefits:

Close in 15 days or less

Minimal paperwork (application, lease agreement, corp docs, escrow docs) BPO with rental survey allowed

Adjustments:

- 0.50% added to the starting rate for borrower cash-out

- 0.50% added to the starting rate if borrower / guarantor has no track rec - 0.25% added to the starting rate if borrower / guarantor FICO is between - 0.25% reduced from the starting rate if borrower / guarantor FICO is grea - 0.25% added if Property Debt-to-Income (PDTI) is between 80% and 90% - 0.25% reduced from the starting rate if Property Debt-to-Income (PDTI) is par pricing will provide a 5% bonus to commission

add 0.5% to rate will provide a 10% bonus to commission

$

$ $

75% 80% 1,016,250.00 $ 1,084,000.00

7.75% 8% 0.250% 0.250% 8.000% 8.250%

$1,100.65 $1,202.03 1,271.48 $ 1,372.86 178.52 $ 77.14

87.69%

94.68%

p

o t

ower / guarantor FICO is greater than or equal to 750

@Rudy Bello

I can't figure out what you're looking for, so I'll just throw this out there.

If you're approaching 10 properties financed and your debt ratio is groaning, go with a portfolio lender that doesn't care about how many properties you have (they actually like that you are experienced) and doesn't care about your debt ratio.

or

You could wrap your current properties together into one mortgage and start with conventional loans again.  The caveat with that is you probably have great interest rates on your current loans and shouldn't want to mess with success.

Incidentally, there are 30 year fixed products out there for you. Stay away from the I/O, I don't care how fast they can close.

Stephanie