Looking for refi stated income, noo, no seasoning
Real Estate Investor · Cumming, GA · Member since 2008 · 36 posts · 0 votes
I am looking for 80% LTV. I have 15 properties already and have maxed out on countrywide, bank of america etc Am looking for newer lenders. Stated income, no owner occupier, no seasoning (normally refi within a month of purchase) stated income (have liquid assets in bank money market) If anyone cab help then let me know I am in GA (Atlanta)
Suntrust needs seasoning. I have asked them. I am not sure about regions bank or Wachovia.
Do you have over 10 mortgages excluding your home? Are you doing a refi from cash position or short term commercial money? We use commercial
then refi when ready. Lately they've been putting in the note that there's a charge or penalty for paying the loan off before 5 years but haven't imposed it yet. Just trying to get a picture of what financing you're talking about.
Can't get conventional loans here if you've got over 10 mortgages. I think that's a fannie mae guideline but pretty much followed by everyone,
When you have 15 or more properties a lot of lenders will no longer deal with you on traditional residential terms. You need to find a specific lender or you need to find a lender who will offer commercial terms that work for you.
With commercial terms seasoning is less of an issue but...
You will be looking at a lower LTV, higher interest rate and a short term than 30 years. All normal for commercial.
Many times the best commercial deals will come from a local bank. Not always the case but certainly worth researching. Such lenders are not available through a mortgage broker in many cases so you might have to contact the commercial loan officer at each local bank.
2-3 of the mortgage brokers who post to BP have blanket solutions that can work for what you are describing.
The refinancing without seasoning could be the biggest issues if you expect higher than 75% LTV. The more you want someone to lend based on the appraised value the lower the LTV or the higher the costs (sometimes both).
John Corey
With commercial terms seasoning is less of an issue but...
You will be looking at a lower LTV, higher interest rate and a short term than 30 years. All normal for commercial.
Many times the best commercial deals will come from a local bank. Not always the case but certainly worth researching. Such lenders are not available through a mortgage broker in many cases so you might have to contact the commercial loan officer at each local bank.
2-3 of the mortgage brokers who post to BP have blanket solutions that can work for what you are describing.
The refinancing without seasoning could be the biggest issues if you expect higher than 75% LTV. The more you want someone to lend based on the appraised value the lower the LTV or the higher the costs (sometimes both).
John Corey
In most cases if I can do 80% LTV I am not too much worried about the rate/term as I can always refi later on. My goal is to refi my existing properties which are under construction loans to permanent financing.
Why do you want to refi a month after purchase with a commercial loan. Won't you burn out your commercial lender. How do they make any money off of your loans?
Personally I think the day of stated income for investors (without W-2's and huge liquid assets) are flickering and personally, if our tax returns showed substantial earnings (adding back depreciation) we wouldn't have to go stated, correct? Check out the wall street journal article today which reports appraisers being asked for tighter comps in the neighborhood, six months reserves and "permit" information on remodeling. One appraiser stated in the article that 70% of his appraisal reports result in turned down loans. How about that?
Personally I think the day of stated income for investors (without W-2's and huge liquid assets) are flickering and personally, if our tax returns showed substantial earnings (adding back depreciation) we wouldn't have to go stated, correct? Check out the wall street journal article today which reports appraisers being asked for tighter comps in the neighborhood, six months reserves and "permit" information on remodeling. One appraiser stated in the article that 70% of his appraisal reports result in turned down loans. How about that?
The construction loan lender will only do one or 2 maximum deals at a time, so I need to refi so he can do more loans on newer deals. I have liquid asset so I am OK there, and all my rentals are cashflowing, but debt ratio is high.
I already know about the apprasiers, I am just wondering why we need them!! as lenders do what they want anyway.
At the end of the day you need to play the game the lender wants if you want their money.
15 construction loans is bad news based on how most lenders will view the situation. They are temporary loans. When you have not refinanced out of them other lenders assume there is a problem so they turn you down. It becomes a self-fulfilling liquidity issue.
Get on to local lenders and some brokers on this side to get a blanket facility sorted.
Most commercial loans that work for residential will allows between 65% LTV and 80% LTV. What will hurt is the DSCR. When they apply the ratio the LTV will get forced down so you are not likely to see 80% for the portfolio. With a blanket facility you do not have to have every property cash flowing. Hence a property being improved that is not rented can be blended with others that are. They want to see the portfolio cash flows.
The market has changed a bit and your portfolio puts you in the big leagues compared to the normal part time or full time RE investor (most have fewer than 10 properties). When you are in the big leagues you need to play by big league rules.
Consider All Cash's model where you sell some and carry a note or get cashed out. That can help restructure the portfolio if the present mix is not right for the lenders. Expect to have more equity tied up so the DSCR works.
Pledging some of your liquid assets is another way to help a lender feel more secure.
John Corey
15 construction loans is bad news based on how most lenders will view the situation. They are temporary loans. When you have not refinanced out of them other lenders assume there is a problem so they turn you down. It becomes a self-fulfilling liquidity issue.
Get on to local lenders and some brokers on this side to get a blanket facility sorted.
Most commercial loans that work for residential will allows between 65% LTV and 80% LTV. What will hurt is the DSCR. When they apply the ratio the LTV will get forced down so you are not likely to see 80% for the portfolio. With a blanket facility you do not have to have every property cash flowing. Hence a property being improved that is not rented can be blended with others that are. They want to see the portfolio cash flows.
The market has changed a bit and your portfolio puts you in the big leagues compared to the normal part time or full time RE investor (most have fewer than 10 properties). When you are in the big leagues you need to play by big league rules.
Consider All Cash's model where you sell some and carry a note or get cashed out. That can help restructure the portfolio if the present mix is not right for the lenders. Expect to have more equity tied up so the DSCR works.
Pledging some of your liquid assets is another way to help a lender feel more secure.
John Corey
I know the market is going through a wobble hence the problem I am in. 15 mortgages are perm, but I have 6 other projects that needs to perm. Unfortunetly buying cash is not an option currently as cashout mortgages are no-no. I have short term lenders but now am struggling to get them refi.
I am switching some contracts in my wife's name. I dont know how to put them in LLC and off my credit report, so I cant do that.
Most of this you probably know but I just want to post for other readers.
The problem is because you are requiring loans outside of the Fannie/Freddie conforming markets. Conforming guidelines only allow for up to 10 properties. Outside of the conforming market you'll have to look for financing with Alt-A (portfolio) lenders. As of 8/3/07 that sector of the mortgage market took a huge blow and we're still feeling daily effects of lenders chaning guidelines or closing their doors.
I have a list of about 7 lenders, all who still allow for unlimited properties. None of them have an Alt-A program that allows for Cash Out with No Seasoning.
However, I do have 1 lender that can do cash out with no seasoning up to 75% and allows up to 10 properites. Their guidelines do note that over 10 properties can be approved as an exception. An exception usually requires a strong file...job history and assets.
One thing to keep in mind also...stated programs are starting to change as well. Many lenders are limiting stated programs to self employed borrowers only, no w2 borrowers.
There's one other lender out there that will do this at 70% cash out but the rates are in the mid 11s with a couple points.
You could also refinance your existing properties held for 12 months with a bank that does commercial loans. I know one that does them at 75% which would clear up properties held in your name giving you a fresh start of getting up to 10 again.
Rate/term is a whole other story...no problems there with seasoning, plenty of options.
The problem is because you are requiring loans outside of the Fannie/Freddie conforming markets. Conforming guidelines only allow for up to 10 properties. Outside of the conforming market you'll have to look for financing with Alt-A (portfolio) lenders. As of 8/3/07 that sector of the mortgage market took a huge blow and we're still feeling daily effects of lenders chaning guidelines or closing their doors.
I have a list of about 7 lenders, all who still allow for unlimited properties. None of them have an Alt-A program that allows for Cash Out with No Seasoning.
However, I do have 1 lender that can do cash out with no seasoning up to 75% and allows up to 10 properites. Their guidelines do note that over 10 properties can be approved as an exception. An exception usually requires a strong file...job history and assets.
One thing to keep in mind also...stated programs are starting to change as well. Many lenders are limiting stated programs to self employed borrowers only, no w2 borrowers.
There's one other lender out there that will do this at 70% cash out but the rates are in the mid 11s with a couple points.
You could also refinance your existing properties held for 12 months with a bank that does commercial loans. I know one that does them at 75% which would clear up properties held in your name giving you a fresh start of getting up to 10 again.
Rate/term is a whole other story...no problems there with seasoning, plenty of options.
Thanks for the info. Do you lend in GA? Also what credit scores do they need?
I can assist you in the state of GA.
Credit scores for all the options I mentioned? They vary so we'd probably be better served to discuss more in detail off forum.
I'll send over a message.