All Forum Posts by: AJ Exner

Quote from @Taz Zettergren:

Does anyone have any experience or recommendations for non recourse lenders that will cross collateralize loans for properties in a retirement account? I have several clients that have a lot of equity in homes they purchased 8+ years ago but can't find a lender that offers the product. 
 

Hey Taz, 

I am aware of one, usually caps at 70% leverage with more of a "limited" recourse, but sounds like it is what you are needing. Just sent a DM and would love to connect.

Mike,

Sounds pretty close, but I maybe add a tweak. With that kind of acquisition strategy, it might benefit to utilized a delayed purchase because most lenders struggle to underwrite deals in the span it takes for the auction to close.

If you do it delayed, you can stay mostly liquid, then follow up the purchase with essentially a cash out refinance of the purchase price with rehab funds being put into an escrow account as well.
Would be happy to explain further, but my clients that operate that way tend to prefer that method to keep getting their cash tied up too much.

Quote from @Ryan Jacques:

Hi all, I just received the below term options on a DSCR new purchase loan (780 credit score). I'm curious to learn if these seem in the reasonable range including the fee amounts. I'd also like to ask if the rate difference between 30 fix and 5/6 Arm is now typically less than 1%. I thought it use to closer to 1% in the past, not closer to .2% like this one.

Option 1:

30 Year Fixed
Loan Amount $202,500.00
LTV 75%
Discount Points %0.00
Prepayment Penalty (3/2/1)
Interest Rate % 8.225
Origination Fee % 0.00
Underwriting Fee $1,645.00
Monthly Mortgage Payments $2,018.76
Broker Fee % 1.25
Cash From Borrower $78,081.01

Option 2:

5/6 ARM
Loan Amount $202,500.00
LTV 75%
Discount Points %0.00
Prepayment Penalty (3/2/1)
Interest Rate % 8.025
Origination Fee % 0.00
Underwriting Fee $1,645.00
Monthly Mortgage Payments $1,990.40
Broker Fee % 1.25
Cash From Borrower $78,052.65

Honestly, its not bad. The best part is the 3/2/1 Prepayment penalty, which is why it is above 8%. I would have hoped to have it in the 7s with the 75% leverage, but seems like a good deal, assuming they can make it happen.

Quote from @Hoa Nguyen:

I recently discussed with a fellow investor who claims he is getting his hard money loans secured for only 10% down. Everywhere I have looked has always been 20% minimum. I didn't dive too much into who he uses as the conversation was brief. Has anyone else done a deal with hard money with only 10% down? If so do you mind sharing who you used? That would be a game changer for future deals for me. 

(spare me the "hard money is dangerous" advice") 

Yes, it is doable but it depends largely on experience and FICO. Shoot, there are HMLs doing 100% if those line up and you've got a good deal. The property values can play a role as well (if certain minimums aren't hit) but it shouldn't be too difficult if you've got one of those two things working for you.

Hey @Riley Smith,

Just saw this pop up and wanted to reach out, I might have a program that fits. Just shot you a DM if you are still needing help with this.

Hey @Omar Ferrer,

For a first timer the biggest differentiator is going to be your FICO. Most lenders will be around 80% Purchase and 100% of rehab if the deal works out, but if you can show them a good FICO then you might be able to creep the initial loan amount up a bit more assuming the loan amount meets the criteria that they want.

I would consider a HELOC on an existing property and just do cash or a Hard Money Loan that can lend to that low of property price/total loan amount.

I know of a few who can do it on the Hard Money side, but minimum amounts should be an easy enough conversation.

Good luck!

Quote from @Nick Giarratano:

We currently have 2 duplexes and looking to expand our portfolio by using the BRRRR method. We have enough money in HELOCs and cash to fund the purchase and rehab steps.

However we have been having trouble finding a lender that is willing to allow us to get the full 80 percent loan to value in a refinance. Wondering  if I should reach out to local credit unions or maybe a mortgage broker? Where do most people turn when looking to get a 20 year mortgage on a property that own outright? 

Hey Nick,

80% is tough on a cash out refi, if the properties are in PA, I do know of a group that can help. Just sent a DM if that might help. 

Otherwise, 75% is going to be way more common. Hopefully you find what you are needing. 

Natalie,

100% agree with @Benjamin Aaker, especially considering that one of the main reasons many utilize an LLC is to limit your liability. If they are all bundled into a single LLC, then it could create liability issues with other assets on something that big.

I have clients that do both, but it really does become what you are willing to manage. Some lenders are more flexible on the account information that is needed, so the clients that do it that way will actually name the LLC after the exact address which makes it a bit easier to track.

Quote from @Nathan Brock:

Hey there!

Mortgage rates make buying a permanent residence painful and costly... I live in central Oregon, a HIGH cost of living area...

I live in a great apartment complex and rents are at least $500/mo lower than a typical mortgage here.

I am thinking about buying an investment BEFORE my permanent residence to keep my monthly CF and savings high.

What are the pros and cons? What should I keep in mind?

Thanks for your expert help!

Nathan

Hey Nathan,

A lot of the private/Hard money lenders that I work with do not require that, so depending on your strategy it shouldn't be an issue.

That sounds like great idea though, it could set you up nicely to hopefully save up for a good primary residence.

Would love to connect and talk through the strategies financially if you are interested!