Pasadena, CA · Member since 2017 · 16 posts · 1 vote
HI all. I have a 2 main questions.
1) I really need to get more information on mortgages. The different kinds of them available as an investor, who to speak to that can help me with this information? or any online resources you suggest that I can read more about these. Using entities V personal for investment mortgages etc
2) I currently have 2 properties in VA ( I am based in CA) I have a rental that has basically seasoned (6 months of a hard money loan) and I want to refinance to a better rate. The first offer I got though was for 9%, and the repayments of the loan were more than the hard money loan I have. So are there any Mortgage brokers licensed in all 50 states or in VA that I can speak with that can help with a refinance? this is a little time sensitive so would to chat as soon as possible.
Conventional financing does not allow for LLC's (although they do allow for the time a property was in the LLC to count toward off setting the seasoning requirement). If you have two hard money loans on two properties and they're in an LLC, you would have to put them into your name to qualify for conventional financing. Otherwise, use a portfolio lender. It will be a more expensive option so be prepared. Another option would be put them in your personal name and get an umbrella liability policy. Lots of threads on BP about one versus the other.
Conventional rates are much lower than 9%. You can cash out refinance on appraised value at 6 months and there is no seasoning requirements for a refinance without cashout.
1) I really need to get more information on mortgages. The different kinds of them available as an investor, who to speak to that can help me with this information? or any online resources you suggest that I can read more about these. Using entities V personal for investment mortgages etc
2) I currently have 2 properties in VA ( I am based in CA) I have a rental that has basically seasoned (6 months of a hard money loan) and I want to refinance to a better rate. The first offer I got though was for 9%, and the repayments of the loan were more than the hard money loan I have. So are there any Mortgage brokers licensed in all 50 states or in VA that I can speak with that can help with a refinance? this is a little time sensitive so would to chat as soon as possible.
regards
Bret
Hey Bret,
It sounds like you're looking to find out more about portfolio financing vs conventional agency (fannie/freddie) options with respect to an investors point of view.
I discuss a bit of this with respect to your scenario however I am not licensed in VA. Once you determine your product pros and cons with regards to your strategy you may want to find a VA licensed lender to deploy that strategy.
9% these days is like hard money so you shouldnt be paying that much if you've been offered that.
If the house is purchased under an entity, doest that affect the percentage rate V's refinancing under your personal name? I know that we use entities for protection, but just wondering if there is a difference in the % as well
@Bret Kennedy You can't refinance under LLC but can refinance on your name under conventional loan. Its same guidelines when you refinance under your name.
If the house is purchased under an entity, doest that affect the percentage rate V's refinancing under your personal name? I know that we use entities for protection, but just wondering if there is a difference in the % as well
Bret
If your home is under an LLC the rates will be higher than regular conventional loans. Depending on the loan amount, fico score and reserves you're looking at 5% to 7% in most cases.
@Harjeet Bhatti I don't think that is accurate. The whole reason for purchasing through an LLC is to protect yourself. I already have 2 hard money loans through my LLC and I am sure that you can refinance (cash out for conventional loans) in your LLC's name.
My main dilemena is sifting through the different types available to me .
Conventional financing does not allow for LLC's (although they do allow for the time a property was in the LLC to count toward off setting the seasoning requirement). If you have two hard money loans on two properties and they're in an LLC, you would have to put them into your name to qualify for conventional financing. Otherwise, use a portfolio lender. It will be a more expensive option so be prepared. Another option would be put them in your personal name and get an umbrella liability policy. Lots of threads on BP about one versus the other.
I completely agree! We have an umbrella policy on our rental properties as well! It is a few hundred a year and we went the route of conventional and saved a lot more than paying the higher rates with LLC financing and portfolio lending.