Homeowner · CT · Member since 2020 · 34 posts · 23 votes
I'm in the process of getting my real estate license in CT as I begin BRRRR investing in Jacksonville, FL. I'm looking to transition from my current full-time salaried position to becoming an agent full-time ideally within 6 months. I spoke with a great lender in my area yesterday and he confirmed concerns I had about loan eligibility during the transition.
Until I have 2 years of tax returns to show an average income as a real estate agent he stated I'll be ineligible for loans regardless of the amount of assets or cash reserves I have. I can have a partner complete the refinance in their name then refinance the properties into my name at a later date, but I would like to avoid that if possible.
Does anyone have any ideas on how I could complete a refinance after the properties I acquire during that time are rehabbed and rented?
Hey Andrew. I'm an investor here in Jacksonville FL and ran into the same issues. There are several lenders who do what are called "non-QM" loans. (non-qualifying mortgage). These are loans based on the income of the property as opposed to your W-2 earnings. I have done 6 of these types of loans with companies such as Finance of America, Lending Home, Verus and Angel Oak. Covid has reduced the number of lenders in this space.
The rates are not nearly as good as Fannie and Freddie rates. My average is about 6% on a 30 year fixed with a 70-75% loan to value. There are more fees than with a regular re-finance but it can be done. I can recommend a mortgage broker here if you need.
Lender · Chicago, IL · Member since 2016 · 653 posts · 313 votes
6y
@Andrew B. Andrew, you need a more creative debt strategy. Shoot me a DM and I can provide you some solid direction that will help solidify your strategy.
You need DCR rental financing, bridge financing, and other sources of non conventional / institutional debt.
Lender · Boulder, CO · Member since 2019 · 44 posts · 35 votes
6y
@Andrew B. There are lenders outside of the Fannie/Freddie/Non-QM world that specialize in loans without having to look at your DTI. Qualification is based on the debt service coverage ratio for the subject property, your credit and your liquidity. Happy to discuss further.