All Forum Posts by: Jonathan Taylor

@Camille Miller agreed. Lenders see ground up on of the most riskiest avenues of real estate lending. Lenders will lend on low LTVs, require shovel ready projects, or foundations laid even before lending maybe 50-65% ARV. Huge emphasis on the maybe part.

Plus, new investors cannot get funding from financing institutions. Mandatory Ground Up experience is required for a lender to even entertain a project. 

@Michael Dardaris long term great tenants are worth their weight in gold but at the end of the day, you are running a business not a charity. If you can utilize the funds to better your RE position and cash flow, then proceed. The tenants do not own the property, you do. Thats the reality of owning vs renting. It may sound cold, but its the truth. 

You can always sell as a contingency tenants stay in place but once you close and walk, there isnt much control you have over the enforcement of said contingency. 

@Chris Kendrick no need for tax returns, no DTI calculations, no income verification. Most full time investors are not W-2 employees nor do they qualify for conventional financing. Its designed for the investor and a crucial loan tool to expand your portfolio.

@Nicholas R Foster I used the NACA program to buy my triplex back in 2019. I put next to nothing down but IMHO NACA's program in reality is very frustrating. The workers are great but under trained, over worked and under paid so getting timely communications, complete answers or clear next steps is a challenge to say the least.

Basically, its a great program but it is not designed for a great customer experience. If you can get through it though, it will set you up well. I now live for free in Los Angeles and have been since 2021. 

@Gregg Truex yes you can as long you are aware of pre payment penalties. You can replace a current DSCR loan with another DSCR loan at a lower rate. As @Glen Friedman stated, these mortgages act as any other.

 @Gavin Doyle can you clarify what you mean by 'just refinanced for $60,000'? Did you mean it appraised for 60k over what you offered on it?

If so, you can refinance after 3 months of closing into either an LLC or personal name with a DSCR loan. If you are going the conventional route you may have to wait 6-12 months before you can refi. I believe the seasoning period was extended to 12 months but resi brokers can chime in and correct me if Im wrong.

Either way, congrats on 60k.

As stated above, DSCR loans will get you where you need to go. Rates are relative to risk so these loans will be higher, not by much, than conventional lending. Closing process is easier, IMHO, but I am biased as I do these types of loans all day.

Hope that helps.

@Johanna Kerns please provide a bit more info as what you posted is not enough to say yes or no.

What is the LTV? What is the DSCR requirement from the lender?

 What metrics are being used to calculate the DSC ratio? ( some lenders vary on how the calculate it)

Is this bank financing or DSCR financing?

What is the loan term ( 30 yr fixed rate or commercial structure)

Is there an I/O period?

This would help narrow down if the deal is on or above market.

@Ravindra Gandhe 

This link describes which LA properties need to be under rent registry. The only exception you may all under is luxury unit.

https://housing.lacity.org/wp-...

Second, here is a link to help with rent registry questions. 

https://dcba.lacounty.gov/news...

If you cannot find what you are looking for, there is an email link to HCIDLA for help. 

@James Burciaga from what you posted this does not sound like a tough deal. Is the garage apartment fully permitted? 

You have two options. Refinance with a conventional loan that would qualify you on your W-2 income and overall DTI. This will be vested in a personal name as most conventional lenders do not lend to LLCs/business on residential 1-4s.

If you want to qualify based on the rents of the property, we can do a DSCR loan that qualifies based on the rents received and the new loan loan payments you will obtain. You can easily vest in an LLC with this option.

What other questions do you have?