Hey y'all, trying to access equity from several SF properties I have, but running into walls in every direction. The 3 properties, all occupied and cashflowing, that I would like to use, all in/near atlanta ga:
I no longer have a w2 job, and have spent the last 3 years working on a startup that is still not earning much to speak of (the no longer in the red).
My wife has a W2, but even with her considered, our debt to income ratio is already beyond what lenders I have spoken to will consider.
How can I access my equity? Is portfolio the solution and if so, any recommendations?
@Chad Keilen I have portfolio of 43 SFH's in Dallas Fort Worth Texas and had been using private money to fund them all. FNMA Freddie Mac lenders didn't seem to like me. Then a Bank OZK commercial lender reviewed my business and my properties. I know have 3 portfolio loans with them. And all is good. Better rate and terms than with private money but higher than government loans.
@Kyle Mccaw thank you. I reached out and unfortunately the debt to income ratio is a problem for them as well.
Anyone know of a lender that considers a loan with debt to income greater than 50%
@Chad Keilen , if you can find a local community bank and talk to a business banker. You will definitely always hit a limit or wall with traditional financing and mortgages. A business banker will lend to you based on your "Global Cash Flow" That is not just W2 income but rather equity, rental income, other revenue streams.
@Chad Keilen - I'd think that you can get an Investor Cash Flow Loan somewhere, so you don't even have to provide any of your income info. These are also known as DSCR loans, and they just require your property to cash-flow at or over your mortgage payment (as determined by an appraiser or an executed lease), plus you must have at least a 600 credit score. Max Loan to Value is 80%.
I'm not personally licensed in the state of GA, but if you're unable to find someone who offers this and you are intersted then I can put you in contact with someone from my company who is licensed in GA.
@Jordan B. Thanks Jordan. Is this a loan in addition to, or is this a cashout refi?
@Reid Chauvin thanks, I would definitely like to be put in contact, thanks!
I am in your same situation. I shopped for a DSCR loan. I called almost all of them and Got a great contact. DM me to discuss if you are interested
@Jessica Tsao message sent, thanks!
Hey @Chad Keilen , your best bet here is to call every local bank/credit union in the area. There are a TON in the Atlanta metro area. Google and Google Maps will be your best friend to find them all.
As long as the assets are performing, I'd be surprised if you did not find at least one that was willing to give a portfolio loan out on them.
Hope this helps a bit - please, feel free to reach out anytime if you have other questions or just want to chat!
@Brenden Mitchum thanks. I found Haus Lending who seems willing to move forward. They are out of NJ. What is the best due diligence I should consider before anything is signed? Their rates are even surprisingly low and I want to make sure I am not getting scammed.
@Chad Keilen Not entirely sure how to check they're legitimate, but taking a look at their website would be a good start. Ask them for references maybe? Don't be afraid to ask questions if you're unsure. Remember, this is a partnership; they aren't just helping you out.
I'd still call around to local banks to get other options and to see how they compare. You can't really call them out on their low rates unless you have other banks quoting you something higher. If that were the case, you could simply ask them how they can be so competitive..
@Brenden Mitchum good points. I'll let u know what I do!
@Chad Keilen like me you are in the commercial lender space. Today 30yr rental lenders go by DSCR lenders. I'm closing 3 cash out Refi bought the rate down to 3.5%, wow, but a 5yr pre pay penalty but I plan on holding 10+yr
Commercial lenders dont care about DTI, or much reserves.
I'm using Finance of America, 50 state lenders. Max 70% Ltv, rates and Ltv depends on your Fico and Dscr. Min loan amount $100k at what ever Ltv.
I feel rates will rise, get yiyr refi cash now is my views.
@Curt Smith funny Curt, I am actually moving forward with Finance of America already, I agree with everything you have mentioned, cheers!