Rental Property Investor · Phoenix, AZ · Member since 2008 · 72 posts · 39 votes
With all the underwriting guidelines changing due to COVID, where are you folks finding "decent" deals on cash out refinancing that's worth looking at? I'm finding that either the rate is not attractive enough or the fees are insanely high. What are you finding and willing to share?
With all the underwriting guidelines changing due to COVID, where are you folks finding "decent" deals on cash out refinancing that's worth looking at? I'm finding that either the rate is not attractive enough or the fees are insanely high. What are you finding and willing to share?
Over the past 1 to 2 weeks many lenders have come back to normal and are offering great rates and terms. Take another look at rates and terms with your broker or loan officer.
Lender · Seattle, WA · Member since 2017 · 118 posts · 161 votes
6y
Today I put a Fannie Mae Small Loan in Oregon under application for $4.8M @ 3.50% - $600K cash out to borrower after fees, reports, title/escrow, legal, insurance, escrows, etc. Tertiary market - so pricing would likely improve the closer you get to downtown Portland.
Both Freddie and Fannie are still active on cash out refinances - though they're likely to be a bit more conservative on full leverage deals - especially when it comes to interest only term and minimum DSCR sizing. They'll also want you to put up anywhere from 6-18 months of P&I at closing held for minimum 9 months to hedge against COVID-related rent delinquency risk.
With all the underwriting guidelines changing due to COVID, where are you folks finding "decent" deals on cash out refinancing that's worth looking at? I'm finding that either the rate is not attractive enough or the fees are insanely high. What are you finding and willing to share?
Hi Steve,
As mentioned above, Fannie & Freddie Cash our refi interest rates have come back to pre-COVID levels in the past month or so. We are currently doing purchases, rate/term refis, and cash out refis in WA, OR, CA, and AZ! Send me a PM and I can look into the specifics of your situation. Have a good evening!
Hi Grant, thank you for the offer. Looking for AL 4-plex cash out refi.
Our shop - Berkadia Commercial Mortgage LLC is a direct Freddie Mac Seller/Servicer and Fannie Mae DUS Lender with nationwide reach for both conventional and small balance loans >$750K. We consistently rank among the Top 5 Fannie / Freddie lenders nationwide.
Feel free to shoot me an email - happy to provide further info, soft quotes, market reports, etc. I'm looking at a Fannie Mae Small Loan for ~$2.0M in Windsor, CO as we speak.
Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
6y
@Steve LeBlanc
Local bank. My local bank can’t help you, but try and establish that relationship with a local bank that keeps loans in-house if you’ll be doing many deals.
Just refinanced through the same bank that held a couple of our mortgages on duplexes. 20% down (cash out 80%), 3.6% interest, 25 year amort, 7 year balloons.
Local bank. My local bank can’t help you, but try and establish that relationship with a local bank that keeps loans in-house if you’ll be doing many deals.
Just refinanced through the same bank that held a couple of our mortgages on duplexes. 20% down (cash out 80%), 3.6% interest, 25 year amort, 7 year balloons.
Great advice but unfortunately I invest across the country and building those local relationships is rarely ever an option. Tried calling the local folks many times and they often times have crude requirements such as living within a certain number of miles to the property in question.
Rental Property Investor · Porter, TX · Member since 2020 · 93 posts · 42 votes
6y
@Steve LeBlanc
Have you tried PenFed? $100 gets you a savings account and $500 gets you no fees. Then they were willing to do an 80% cash out down to $50K loan as long as I held the place for 6 months. It might be worth a call. They are all over the US. I invest out of state.
Have you tried PenFed? $100 gets you a savings account and $500 gets you no fees. Then they were willing to do an 80% cash out down to $50K loan as long as I held the place for 6 months. It might be worth a call. They are all over the US. I invest out of state.
https://www.penfed.org/mortgage-center
I forgot about them. I used them years ago for a vehicle loan and were great to work with. Thanks for the suggestion.
30 year fixed loan at 70% LTV with a 3 year pre-payment penalty and is based on a 800 FICO score.
6.75% APR $1918: 2 lender points
$1720: lender underwriting / doc fee
$1918: 2 point broker fee
$500 appraisal
Total cost: $6056 + pre paids
Prime Lending
30 year, 70% LTV
5.625% APR (was told today that it's come down this week from this)
Lender: $1350 Appraisal: $475
Title: $1300
Total cost: $3125 + pre paids
@Steve LeBlanc: I'm just curious, I went out of my way to invest in Phoenix and have done well there. I'm still buying in the area. Why would you need to go to other locations since you are in Phoenix? As I said, just curious.
Anyway, 1st Bank in Phoenix is doing 70% LTV on a cash out refi with a 15 year fixed, 1.5% origination, at 3.375%
30 year fixed loan at 70% LTV with a 3 year pre-payment penalty and is based on a 800 FICO score.
6.75% APR $1918: 2 lender points
$1720: lender underwriting / doc fee
$1918: 2 point broker fee
$500 appraisal
Total cost: $6056 + pre paids
Prime Lending
30 year, 70% LTV
5.625% APR (was told today that it's come down this week from this)
Lender: $1350 Appraisal: $475
Title: $1300
Total cost: $3125 + pre paids
@Steve LeBlanc: I'm just curious, I went out of my way to invest in Phoenix and have done well there. I'm still buying in the area. Why would you need to go to other locations since you are in Phoenix? As I said, just curious.
Anyway, 1st Bank in Phoenix is doing 70% LTV on a cash out refi with a 15 year fixed, 1.5% origination, at 3.375%
Great question, and my assessment is based on my strategy. I invest for cash flow. There is no cash flow in Phoenix. There is plenty of value adds or decent flips (neither are my core strategy). I imagine you may respond in disagreement, I’d ask that you share your numbers just so we can take a look.
And when I say cash flow, I mean something like the following which I pick up in the eastern part of the country fairly frequently:
$130k purchase price
Monthly rent collected: $2000
Insurance: $1200
Taxes: $1500
PM: 8% mx/vac: 10% Financed 30 years at 5.5% ish with 70 to 80% LTV (timing dependent). We're talking over 20% cash on cash.
It just does not exist in today’s Phoenix market where Californians are driving costs up, up and up.
Our shop - Berkadia Commercial Mortgage LLC is a direct Freddie Mac Seller/Servicer and Fannie Mae DUS Lender with nationwide reach for both conventional and small balance loans >$750K. We consistently rank among the Top 5 Fannie / Freddie lenders nationwide.
Feel free to shoot me an email - happy to provide further info, soft quotes, market reports, etc. I'm looking at a Fannie Mae Small Loan for ~$2.0M in Windsor, CO as we speak.
@Ian Stuart you say you have Nationwide reach, does this mean you can lend in any state? I'm looking for a lender in NY.
Specialist · Easton, PA · Member since 2018 · 1k+ posts · 2k+ votes
6y
@Steve LeBlanc
I am currently in the process of one on my primary. We had a great rate already, but pulling out some equity, getting rid of PMI, and payment will be $90 less. Small 3 branch local bank, in house financing.
30 year fixed loan at 70% LTV with a 3 year pre-payment penalty and is based on a 800 FICO score.
6.75% APR $1918: 2 lender points
$1720: lender underwriting / doc fee
$1918: 2 point broker fee
$500 appraisal
Total cost: $6056 + pre paids
Prime Lending
30 year, 70% LTV
5.625% APR (was told today that it's come down this week from this)
Lender: $1350 Appraisal: $475
Title: $1300
Total cost: $3125 + pre paids
@Steve LeBlanc: I'm just curious, I went out of my way to invest in Phoenix and have done well there. I'm still buying in the area. Why would you need to go to other locations since you are in Phoenix? As I said, just curious.
Anyway, 1st Bank in Phoenix is doing 70% LTV on a cash out refi with a 15 year fixed, 1.5% origination, at 3.375%
Great question, and my assessment is based on my strategy. I invest for cash flow. There is no cash flow in Phoenix. There is plenty of value adds or decent flips (neither are my core strategy). I imagine you may respond in disagreement, I’d ask that you share your numbers just so we can take a look.
And when I say cash flow, I mean something like the following which I pick up in the eastern part of the country fairly frequently:
$130k purchase price
Monthly rent collected: $2000
Insurance: $1200
Taxes: $1500
PM: 8% mx/vac: 10% Financed 30 years at 5.5% ish with 70 to 80% LTV (timing dependent). We're talking over 20% cash on cash.
It just does not exist in today’s Phoenix market where Californians are driving costs up, up and up.
If you are comfortable, can you tell the name of the city/cities("which I pick up in the eastern part of the country"). I am from Los Angeles and investing in phoenix currently