All Forum Posts by: Ed Burk

@John E Ceisel- Little late to this party- Non-warrantable Condos will allow up to a 65% LTV on a 30 yr. fixed.

@Arta Montero- You will see Long term rental, 30 Year Fixed rates range from 4.375% and up (Depending on guarantor qualifications, Property Type, Program Type, Buy-downs, Leverage %  etc.). Fix and Flip Rehab financing from 7.75% to 9.99%. Quite a few factors would go into an exact number for you.

@Jessica Amoroso Hope everything works in your favor! Thanks Jessica...

@Duke M.- The alternative to your DTI issue, would be a DSCR (Debt service) Income qualifying loan, which would be through a Private Lender as opposed to your traditional bank/ Conforming lenders. DSCR Income takes 90%/100% of the current Lease income and divides that into the PITIA payment- If that number results in a positive cash flow (1.0x-1.15x+) that would qualify. Private money does not ask for Tax Returns/Paystubs/W-2's etc..This applies to Purchases | Rate-Term Refinance and Cash-Out Refinances.. And traditionally these Mortgages are not reported to the credit repositories.

@Slade Sizemore- As mentioned above, Great advice. As a Private Lender I would add, based on the Appraisal/ARV as it pertains to the Current "as-is" Condition (C1-New Construction thru C5-Requires significant repairs) of the property to the Expected "as repaired" condition of the property.The footprint of the property is absolutely essential as stated above, closely reviewing the interior/exterior pictures in addition, will help you fine tune your ARV value based on the improvements your planning compared to the Improvements done to the comparable(s). Going from a C4/C5 to C4/C3 could get you the better ROI.

@Jessica Amoroso- As a Private Lender, Cash Out would be up to a 75% LTV MAX on a SFR, DSCR qualifying loan with a 700+ Fico.

As a PML I do run into this question quite often, there are some great reply's from our colleagues thus far. I can offer some insight as it pertains to Private money. As mentioned by @Carlos Ptriawan, PML does NOT base the qualification off your Income/Debt Ratio- In fact these qualification parameters are non existent, which will address your initial concern. Rates/Fees will be higher than Conventional due to the lighter doc requirements and ease of qualifying. 80% LTV is out there. Side note- PML traditionally do NOT report the the credit repositories and not shown on the credit report.

1) Cashflow/Debt Service is the Key- Based on the Lease agreement or 1007 Rent addendum, 90%-100% of the Lease income is factored into the PITIA. Simply put, if this ratio is >1.0x/1.15x, this would qualify as your income. Done

2) Not all have a seasoning requirement. Currently there are no restrictions as to when or how many properties an Investor can Purchase/Refinance at a given time. As long as there are sufficient Assets to cover the Purchase transaction, Debt Service checks out and Payment/Credit is in line. 

3) Timing/Timing/Timing-  Best terms will undoubtedly be with a Conventional Lender, if you can wait it out-Perfect. If the right opportunity is presented where can not wait, PML would be an excellent option to get into it.

The best of fortune to you Ben

It wouldn't matter initially where the LLC was established, being in both instances, the entity(s) would be reviewed in the same capacity. The only single difference, would be if the "Certificate of Foreign Qualification" MD in PA or PA in MD is in play. An established LLC say in PA for a PA property would be simpler being it needs nothing in addition. Does that help?

Your welcome- If you don't have any time restraints with Business needing to close in the near future , with MD being home base long term, I would lean towards getting the MD LLC established and work off of that. Just from my lenders POV if your securing Capital down the road.

@Kealan Hobelmann - As a Lender, traditionally we would need a 'Certificate of Foreign Qualification" if your LLC is doing business outside the registered state. “Foreign qualification” refers to registering your business with the secretary of state office of another state. It enables your company to legally pursue growth opportunities across state borders without having to incorporate a new business entity. It’s typically the first step in expanding a business to a new state.