DSCR Long Term Refinance for 92K Value Property

[Tahsin Ishtiaque]

I am looking to refinance one of the investment properties that I bought last December for 75k. I was working with a lender and they did the appraisal and it came back 92k. So with the 75% LTV loan balance came out at 69k but they did not move forward as there was a late payment that was 12 months old. Now most of the DSCR lenders min loan amount is 75k and I am sitting around 69K. I am looking for lenders who will do rate term refinance for this property. Its located in Garfield Heights, OH and currently under conventional mortgage. Any help will be appreciated. Credit Score is 724. I also have another investment property in Lorain area that has been appraised at 102k and current mortgage balance is 68k. I would be open to merge these two loans and make it a portfolio if needed to do the deal.

[Nate Herndon]

Quote from @Marcus Ball:

I’ve been researching this lately. I purchased investment properties eight years ago, and many of them have appreciated significantly, with some gaining an additional $80k to $90k in equity. I’m considering a cash-out refinance, but the current interest rates are giving me pause!

Hi Marcus - I am having this same conversation daily with clients. It is all about whether accessing the equity is important to you now or if you are ok with waiting out the interest rates.

Interest-only loans (30-year term, 10-year fixed interest only, adjustable rate thereafter) would help with cash-flow a little. I am more inclined to reduce your prepayment penalty to a 3-year (vs. the standard 5-year), which would allow you access equity now and look for a more exciting interest rate between years 3-5.