All Forum Posts by: Jason Wray

Tom,

the company you are using is really geared for small business loans, credit cards but not great for home loans or investment property loans. They typically run a soft pull and only use (1) bureau until underwriting. However Credit K is not a credit bureau and not for properly scoring an algorithm that can be used for banks/lender to offer credit/loans.

Credit K is for the general public for personal monitoring but the scores are "Always" hyperinflated and not what the banks/lender pull their credit bureau vendors. There are only certain companies approved to be used for the purposes of credit risk on loans and mortgages.

When you go with an bigger bank they pull a tri-merge report with all (3) bureaus.  The bank uses the "Middle Score" out of the (3) scores.  So they ignore the high & low score and use the middle score as the qualifying score.  If I were you I would use another bank so they are not using just one score which may be your low score.

Steven

You are actually fine the bank/lender you are using is not calculating your income correctly or they are not allowing the recent rentals to either wash themselves. Some lenders have "Overlays" which is basically another word for handcuffs. Its not their fault its because they are a correspondent or a wholesaler. They have to abide by their buyer/servicers guide lines/overlays in order to ensure A/B paper.

You have other options in order to get the cash out that is needed either Heloc, 2nd mortgage, cash out refinance, or non-secure. All of these offer different options but usually a cash out refinance makes the most sense now a days due to rates. Best to have a Banker run the run all those scenarios to check the PITI and see which one is most cost efficient.

If you have any questions feel free to message me I can explain in detail and walk you through the 1120's and net rental income.

Looking to buy an Investment rental property if it is 2-4 Units I offer a 15% down even on Jumbo loans. No Prepayment penalties and you can close in an LLC. This is not a DSCR program but if you need DSCR I also offer DSCR purchase and refinance options.

Save 5% on a purchase keep that for your renovations or to stay in your bank as reserves.  or if this is a primary home we can go 3.5% down.

Send me an email or give me a call - Feel free to checck out my profile or website.  We Fund Nationwide including Hawaii

[email protected]  

Jennifer,

You are having a hard time on that loan amount because that loan amount in most cases violates the "High Cost Rule" which means banks have to make a certain margin on every mortgage. This amount cannot change due to loan amount. So when a bank/lender has to charge a processing fee, underwriting fee, credit report fee, and still pay their banker/loan officer. The $75k cannot fit the margin built into the financing so the loan cannot be approved.

What you can do is you can get a non-secured loan for up to $50K if you have the credit score and income to support. Then when the property appraises for more after you have owned it for some time you can refinance it to pull out some cash and pay off the loan. The other options would be to get a secured line of credit and use the property as collateral.

There is a huge difference in lender who fund on properties that will be a LTH versus a Flip.  Most lender do not want or offer loans for home flippers.  Typically you will see a prepayment penalty which is an obvious indicator.  When you do not keep a home for more than 6 months the bank actually loses some margin in most cases.  

Fix & Flip is a true loan program which usually requires 20%-25% LTC/LTV but with higher rates and points with a shorter term/balloon. Non/QM.

Unless you are doing a 1031 exchange flips can cost a good chink of change on taxes now that rates and fee's are much higher.  If the property cash flows it makes sense to keep it and use the equity to pull some cash out and buy another rental.  There are no taxes paid on a cash out refinance but there are big chunks of taxes when you sell.  

Damein,

You can use an investment rental portfolio program, Freddie Mac or a DCSR cash out refinance program. All you have to do is just pick the best product based on the loan amount, credit score, and property type. Its always best to run pricing for all of the options to see which one has the better rates, terms and highest LTV.

Best thing to do is just have a quick conversation with a Banker/loan officer to get the pre-approval.

One idea is you can subdivide the 1 acre into 4-5 parcels turning them into divided lots of land. You can put a Manufactured or Modular home on one lot to start the process as a primary or secondary home. Once the home is recorded you can finance more mobile/manufactured homes to put on the other lots. Sell them all and create an HOA or mobile home community program and charge a monthly lot fee to service and maintain the land.

You could also sell or lease the lots and allow the lots to be used as a mobile/modular home site with a lot fee. There is no construction when you buy a new mobile or manufactured/modular home its all prefab or transport to site. That makes the project quick to start and fast to make money if you market it correctly. You would want to check zoning but in most cases it would be within rights to permit.

Reach out to @Lucia Rushton great agent and can help you with any REI in DFW.

Erick,

Instead of a heloc what about doing a cash out refinance and avoid taking on 2 liens on the primary and an open end debt.  Helocs are like credit cards they can cause more issues if something goes wrong.  I am sure like most people you have a low rate on your first mortgage but rates will come back down over the next couple of years.

You can take out the cash out and refinance for a lower rate and shortly after to lower the payment.

Raymon,

I am in Pinellas County and have noticed Citrus County is picking up in terms of home values. Having Crystal River, 3 Sister Springs and Homosassa Springs helps with the STR/VRBO options as well. If you have $80K set a side already your off to a good pace in terms of down payment funds. You only need 15% down for an investment rental and I know that there are some good deals on 2-4 Unit multifamily around Citrus County.

Have you thought about which property type you plan on tackling first or just looking for a good deal/cash flow. I was just up there with family to take the boat out to look for scallops and fish. Looks like the city has several new places to eat some good seafood spots and steak houses.