All Forum Posts by: Jeffrey Blackman

@Torrean Edwards, you are not a quitter. The deal didn't make sense. The numbers didn't work with what you are able to see. Anytime you do $100K worth of work, you find surprises, so the real number is probably even higher. Walking away seems smart.

Hi Leah, as you might imagine, most of the benefits focus on individuals and properties directly impacted by the disaster. They could include things like waivers for documents and appraisals, relaxation of underwriting standards and money to fund repairs.

However, there are benefits for people who just live in the areas, but aren't directly impacted. For example, the FHA will all 100% financing on a purchase anywhere in the country, not just in the disaster area, for someone residing in a disaster area at the time of the disaster, whether they were a homeowner or renter. I believe you have 12 months after the declaration to qualify. Additionally, Fannie Mae and Freddie Mac will sometimes temporarily suspend the income cap on their HomeReady and HomePossible programs, which allow purchases with 3% down. Normally, you need to earn no more than 80% of the area median income to qualify for those programs.

Speak with your banker or broker and good luck!  

@David Dachtera, no such thing as a dumb question. Park owners always own the land, sometimes they will own the homes and rent/lease them to tenants. Parks with few or no park-owned homes are easier to finance.

@Leah Miller, unfortunately, you'll need to have the property reinspected. I once had a closing in the Florida panhandle scheduled for an afternoon. At noon, the President declared a disaster area for the county because of a hurricane that had recently come through. We couldn't close and had to have (and pay for) a re-inspection, even though the hurricane did not come anywhere close by. Had we scheduled the closing in the morning, there would not have been an issue.

The only potential upside is that a disaster area declaration triggers changes in mortgage rules that could beneficial to the buyer.

@Adonis Williams, you've received great comments: It depends on so many things, including FICO, LTV, type of loan, etc. That said, realistically, I don't think you can go below the 6% - 6.5% range.

One question I would ask is if that 3% can be better spent somewhere else to de-risk your deal. You haven't told us anything about what you plan to do after purchasing the property, so it's not clear how important interest rate is in the long run. Knowing your long-term plans can help you build a long-term financing strategy so that you are not just worried about purchase number 4, but also purchases 5 - 20+ (if you plan to continue to invest).

I'm an investor and licensed mortgage broker. I'd be happy to share my experiences from both perspectives.

Hi @Diandre Pierce,

You may want to think about a DSCR portfolio loan for your existing 7 properties. This could give you the cash you need for the purchase and also eliminate your personal guarantee for the loans. I'd be happy to talk through the strengths and weaknesses with you.

@Peter Mckernan, that's a great point. The Fannie and Freddie programs handle this issue slightly differently. They allow you to include up to 6 months of rent payments in the loan if you are unable to occupy the premises during the renovation.

Just to be complete, it's also worth mentioning that both the VA and USDA have renovation loans. However, they are not as flexible as Fannie, Freddie and FHA.

I would look for an experienced agent of my own who understands what is standard for your market. I've purchased about 10 properties for myself and have always use my own broker.

Hi @Leon George, welcome to BP! One other thing to keep in mind is that you have more financing options on 2-4 units than you do on 5+ units.

HI @Fernando Sosa, I'm an investor and also a mortgage broker licensed in Florida. I represent several DSCR lenders and would be happy to discuss the strengths and weaknesses of different programs.