All Forum Posts by: Jerry Padilla

@Derek Debiak

Rates have very recently dropped. If the rates are lower than the current rate on your primary, I think it would be worth looking into the cash out refinance now, to also lower your current interest rate.

The drawback to a HELOC is that the rate is variable and if you plan to take the money out for the long term, you don't know where rates will be 10 years from now.

@Jordan Mantel

I completely agree with Eric.

No gift funds are allowed at all on investment properties. There is no way around 60 days of seasoning.

@Ryan Collins

His credit shouldn't take a hard hit. He should do it now, while it is a primary residence as he will get better rates and LTV. When he decides to rent the property out, he will be able to count the rental income to improve his DTI's as well.

@Steven Nitschke

If your credit, income and DTI's allow for it, I don't see why you wouldn't get approved. If you are going conventional, find a lender that is able to count rental income without a 2 year history on purchases. This will help with your DTI's, and scaling faster. There are also renovations loans for properties that you are holding, but you are limited to a max of 4 financed properties, including the subject property.

@Liz Mojica

Conventional financing is where you are going to see the lowest rates for investment purchases. If you are purchasing a primary multi-family or a multi-family just for investment purchases, I would recommend going with a lender that will count the rental properties income at a 75% rate - which is Fannie Mae's requirement. Some lenders have overlays and won't count rental income for the first 2 years and that can make it difficult to get approved with high DTI's.

@Melissa Dwiggins

Any loan amounts under $100k are going to have higher rates, especially when you get around $50k and lower. That rate doesn't sound too far off. 

How Long Will You Pay the MIP?

For loans with FHA case numbers assigned on or after June 3, 2013, FHA will collect the annual MIP, which is the time at which you will pay for FHA Mortgage Insurance Premiums on your FHA loan. They are as follows:

@Wayne Brooks

Is absolutely correct. It will only drop off for conventional financing, not FHA. As he mentioned the only way to get out of the mortgage insurance is to refinance after you reach 80% of the current appraised value of the property.

When did you purchase the property?

If it is a current purchase that money is gone for the upfront MIP and the mortgage insurance stays on for life.......... Which is why FHA can be pricier than other conventional financing routes. An alternative is Home Possible, if you don't meet the income restrictions than try to find a property in a no income limit area. Home Possible is only 5% down for up to 4 units. They now limit you to a total of 2 financed properties total.

@Taylor Stamm 

Right now is going to be tough trying to purchase an investment property. I would save money and make sure to keep your credit score up. 

The good thing I see here is that when you graduate from college - the 2 year income history includes college education. So as soon as you start working and have 30 days of pay stubs you will be able to close on a new property.