All Forum Posts by: Ashley Cross

In that case, I think going the conventional route may be better. But you should definitely do a loan cost comparison when you get a property locked down. I've done loan cost comparisons like this quite a bit for investors and the conventional route usually is the winner in the long run. You'd just have to be sure that tying up that much capital then won't hurt you in the short run if another deal comes up. 

Hi Vince. The interest rates will be lower for a FHA mortgage vs conventional but the fees are higher. The biggest pro is that you will be able to get into an investment property with very little capital. Your cashflow may be limited and you will have to pay mortgage insurance. The best strategy will be refinancing the property into a conventional loan after a year then move out. You always get better pricing when you refinance a primary residence.

I agree with @Brendon Pishny Sell it asap

Hi Danielle! Did you check the market comparables? Look over the comps the appraiser provided to ensure they are accurate in your opinion. Did you review the appraisal for $950k? You could always provide those comps to rebut the value.  Because of the pandemic and low interest rates a lot of home prices were inflated. The market is correcting itself and I'd be surprise if you get the appraised value of $950k in a year. 

I agree. Never pay any fees to the lender upfront. 

You'll have to wait two years to use that income. We use your average income for the 24 months to determine your monthly income for that property.

The 6 month seasoning rule refers to purchasing and pulling forced equity. That applies to the Brrr method. If you already had the equity when you did your r/t refinance you can do a cash out whenever. The 6 months payment thing is really the lender's issue. We get dinged by the investor if you don't make at least 6 payments on your mortgage. 

If you are looking for conventional financing, the max LTV is 70% for a c/o refi of 2-4 units. And you should expect a higher interest rate than 3.1% unless you're buying the rate down. You definitely don't need a commercial loan unless you're attempting to accomplish something else that you didn't mention.

I have and its very tough. The property was in bad shape and we had to get an extra inspection to get the deal done but it's possible. Honestly, the property needs to "look" like the condition is okay.

Where is the subject property located? It sounds like you're looking for a DSCR loan.