Looking for 80% LTV cash out refi for duplex in my LLC

Member since 2019 · 17 posts · 8 votes

Hey all. I am finished with my latest BRRR which is a duplex. Tenants secured. Need to cash out refi however my seasoned banker quit, and his new replacement is switching up my terms. I always was given 80% LTV but they took it down to 75% which impacts my numbers. Anyone who can do this deal in PA please reach out to me!

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Jeff CopelandBusiness Member

Real Estate Broker · Tampa Bay/St Petersburg, FL · Member since 2015 · 1k+ posts · 2k+ votes

The Fannie Mae underwriting guidelines are actually 70% LTV for multifamily investment properties in a cash out refi:

The following is from https://singlefamily.fanniemae...dated October 2022:

What often happens is a loan originator will tell you "Sure, we can go up to 80% LTV on investment properties". But they are referring to the max LTV for a single family home purchase. Once they realize it's a duplex and a refinance, and they run it through their underwriting program, it's probably going to come back at 70%.

You may find a local portfolio lender, or a DSCR or other non-QM product that will go to 80%, but the rates and terms are not likely to be as attractive as conventional Fannie/Freddie backed options.

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Matthew Niemynski
Wholesaler · Philadelphia, PA · Member since 2021 · 39 posts · 18 votes
4y
Hey Jillian! Not sure if you tried this yet.. if you go to the Network tab here in BP you can find some mortgage brokers that you can connect with. Some of them may be able to help you out. I will keep my eyes open for that 80% LTV, a lot of the lenders I work with do 75% LTV. Good Luck!
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Jillian ShulerPro Member
OP
Member since 2019 · 17 posts · 8 votes
4y
Thanks @Matthew Niemynski! I’ll head there!
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Eliott Elias
Investor · Austin, TX · Member since 2021 · 9k+ posts · 5k+ votes
4y
You would have to wait 6 months and have a credit of over 750
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Jeff CopelandBusiness Member
Real Estate Broker · Tampa Bay/St Petersburg, FL · Member since 2015 · 1k+ posts · 2k+ votes
4y
The Fannie Mae underwriting guidelines are actually 70% LTV for multifamily investment properties in a cash out refi:

The following is from https://singlefamily.fanniemae...dated October 2022:

What often happens is a loan originator will tell you "Sure, we can go up to 80% LTV on investment properties". But they are referring to the max LTV for a single family home purchase. Once they realize it's a duplex and a refinance, and they run it through their underwriting program, it's probably going to come back at 70%.

You may find a local portfolio lender, or a DSCR or other non-QM product that will go to 80%, but the rates and terms are not likely to be as attractive as conventional Fannie/Freddie backed options.
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Jillian ShulerPro Member
OP
Member since 2019 · 17 posts · 8 votes
4y
I had terms with my previous lender...no seasoning period and 80% LTV for multi families (2-4 units). I know it can be done, so just asking around. Thanks.
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Khari F.
Kissimmee, FL · Member since 2018 · 150 posts · 27 votes
4y
Quote from @Jillian Shuler:
I had terms with my previous lender...no seasoning period and 80% LTV for multi families (2-4 units). I know it can be done, so just asking around. Thanks.
It can be done but do you know why your terms were changed?
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Matt Cartwright
Lender · Newport Beach, CA · Member since 2016 · 68 posts · 18 votes
4y
@Jillian Shuler I am able to go to 80% C/O in PA given the DSCR is still in good standing. Happy to connect on this!
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Zach Wain
Scottsdale, AZ · Member since 2019 · 435 posts · 248 votes
4y
DSCR will be the only option, but its definitely possible
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Lyndsay Zwirlein
Lender · Member since 2020 · 331 posts · 209 votes
4y
Quote from @Jillian Shuler:

Hey all. I am finished with my latest BRRR which is a duplex. Tenants secured. Need to cash out refi however my seasoned banker quit, and his new replacement is switching up my terms. I always was given 80% LTV but they took it down to 75% which impacts my numbers. Anyone who can do this deal in PA please reach out to me!

Hey Jillian! When did you purchase it? That will impact terms!
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David Kelly
Lender · Nationwide Lender · Member since 2019 · 391 posts · 140 votes
4y
@Jillian Shuler
Portfolio loan - 85% LTV - 1-4 units cash out - No Mortgage insurance. Must meet a minimum 720 fico score, and under 43% DTI. If you are married, the spouse must also provide the info for qualifying. I can get exceptions on some of these, so it may be worth looking into. There does not always need to be a 6 month seasoning period if you have some "skin" in the game on the refinance. Lending in most states with this program. There's a few we exclude.
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Erik EstradaBusiness Member
Lender · Los Angeles, CA · Member since 2022 · 7k+ posts · 1k+ votes
4y
Quote from @Jillian Shuler:
I had terms with my previous lender...no seasoning period and 80% LTV for multi families (2-4 units). I know it can be done, so just asking around. Thanks.

Why didn't you choose them then?
[email protected]818-269-7983
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Simmy AhluwaliaPro Member
Lender · Atlanta, GA · Member since 2015 · 1k+ posts · 200 votes
4y
Like everyone else said, if the property DSCR's, then yes, we can get to 80% on the cash-out. Our pricing for these is strictly Interest Only ARM's. 5/1, 7/1, 10/1.
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