All Forum Posts by: Jason Wray

Jacob,

If the debts are adding up and you want to consolidate you can do a VA 100% cash out refinance to pay off all or some of your debts. You can also take out a 2nd loan on the home is the 1st is super low and still pay off debts. Then last option would be a "unsecured" personal loan where the bank offers up to $50K for example to pay off and consolidate debts.

The 2nd and the personal loan will pay off debts and lower DTI and you might have enough left over for down payment or just use VA again. There are some tricks and loopholes to this method to ensure you are doing it to maximize best efforts. You do have other programs like DSCR that do not look or require income or look at DTI.

Instead the DSCR uses the rents of the purchased property to qualify so long as the rents support "Debt services" the new loans PITI. DSCR requires 15% down for single and 20% down for 2-4 units. If you have any specific questions feel free to reach out I always enjoy talking REI!

Peter,

That does not sound accurate based on having a Schedule E and being able to take those deductions as well as other standards.

As an investor it's not a bad thing to show more gross income which usually allows you to buy more properties with more income and a lower DTI. When you show more income you do in some cases owe more to Uncle Sam, if you are not utilizing the Max deductions correctly.

I would ask your CPA and maybe even get a second opinion on if he/she is accounting for all 365 days, taxes, mortgage interest, repairs, depreciation, vacancy, closing costs.

There is always a way to 'Zero" out and not owe in most cases.

 Chrissy,

I am here in Florida as well send me a message lets chat.

I wanted to circle back on this because to point out I was wrong is not actually accurate. Delayed financing is a term used under Non/QM and also Private or FDIC Bank Portfolio programs. When I referred to "Delayed financing" it was associated with (Not having a mortgage) which means both of the above carry (No recourse) or do not require a personal guarantee.

There are more banks and lenders that offer non recourse then the ones on that list that offer financing in the US and globally. There are also DSCR lenders that do not require a personal guarantee and again use the term delayed financing as their "program" under their Matrix/guide lines. Some of them are state specific and a few smaller that deal with more of the broker channels.

Anything Newsom related seems like a badly produced reality show in CA...... 

Matthew,

Based on recent investor track records I would say choose Ohio over NY or NJ for a 2-4 unit.  You are going to get a better deal and cash flow is easier in that state versus NY or NJ.  Both NJ & NY have higher taxes, higher sale prices, and higher number of offers per listing.  I have seen some great deal in and around Dayton as well.

This year will be a good year as rates start to come back down we took a little hit last week but should start to drop by 2nd quarter.  

Paula,

You can take out the cash through a "Delayed Financing" loan that offer 80% cash out with no wait.  When you pay 'All cash" you get the benefit of being able to avoid the typical (6 month) title seasoning wait to pull out cash.

There are a couple of options under this program but very simple for the most part. If you have any questions feel free to reach out always happy to talk REI and help.

Nothing wrong with renting out rooms which is called (Boarder income). It can be used as income the year after you collect if filed on tax returns and offers deductions as well to offset monies owed. VA is great for the 100% financing which covers 2-4 units as well and those can be rented in addition to rooms in a primary.

Just make sure you shop around for quotes (without letting multiple lenders pull credit).  I have Navy Federal Credit Union and you would think they have better rates, but not exactly.  All depends on loan size, credit and property type.  Some banks offer better options versus lenders and credit unions.  You also want to avoid paying points or broker fee's so going to a Fully Delegated bank can help avoid those hits.

That room cost is normal I have seen much higher especially in Virginia Beach!

Dominic,

You have a lot of questions which is great but the questions demonstrate this is your first REI and having partners can complicate things if not handled correctly. This is where having a seasoned real estate agent comes in handy. Realtors are well versed in contract law and verbiage to help avoid issues during and after closing.

Agents also work closely with the Bank/Lender to help the buyers and sellers close on time and without issues. The Bank handles the appraisal you cannot order one by law if financing is involved due to AMC rules under the Dodd Frank act. The Bank also communicates with the title company to order chain of title and require lender/title insurance. That will provide you with confidence knowing there are no taxes owned or unpaid liens.

I have worked with Lucia Rushton in DFW multiple times who can great agent and it is well worth using her to avoid painful mistakes!  You can find her on Bigger Pockets as well reach out to @Lucia Rushton

Alex,

If you are earning W2 income it's possible to get an approval but in order to offer an exact answer the income and DTI would have to be calculated. You have to calculate based on a more than a few things like loan amount, down payment, taxes, Insurance, (Any HOA) PMI, based on credit, etc.

If you are 1099 the Bank can look at the most recent 1099/Schedule C if you have been in business for 5 years or more with a 25% ownership in company or more.  There is also a Bank statement loan but that would require 10% down where they use gross deposits instead of income/taxes.