All Forum Posts by: Jesse Rivera

Meetup has some groups, but non have met in person during Covid, so not very active. If you start one, I would love to join.

I think you should be fine, but maybe put an area rug on the concrete? Has your lender tried to get an appraisal waiver?

Why would you put an offer on a property if you didn't have your financing ready to go? Not only your hard money, but for your refinance as well? Get pre-approved. 

For hard money, they won't pre-approve you, but you can get a detailed list of what they need and what they won't do.

For your refinance, get a pre-approval. If going conventional or VA, make sure they run credit, look at income etc. You don't want any surprises when it comes time to get out of the hard money loan. And if your lender won't do the work before you make an offer, find another lender, hopefully one that is investor friendly.

And as a reminder, ALWAYS get an approval (for your refinance) from you mortgage broker BEFORE you buy a property. Sounds like you already own this property, but I would do it anyway before you spend any money. I talk to a lot of people who tell me that they will have no problem getting a loan, and then we find something that they didn't consider, and I have to decline them (or get them into a non conventional, which is more expensive).

And you can get a better idea of costs and interest rate for the loan.

Always get this done before you move forward.

Great advice from Evan. Also make sure that your California partner knows that if he/she becomes a partner in a LLC or corporation, no matter where it's registered, he/she will have to pay a $800/year tax. EVERY YEAR! That never has a great affect on your numbers.

If all three units are filled, you won't be able to do an FHA loan, that's owner occupied only. There are a lot of factors, but you may need to start with a DSCR loan, which looks mostly at the amount of income from the units vs the mortgage. But you need a bigger down payment for those.

How much is the purchase price? How is your FICO score? How much max down payment can you put down?

For a triplex, if all units are filled, you will probably need 25% down payment - minimum. 

If you can get one of the tenants to leave before closing, you may be able to do FHA (3.5% down), but for a triplex you will run into the self-sufficiency rule. The total rent that you receive for the units must be equal to or greater than the mortgage payment. In higher priced areas, that can ruin the deal.

Another option is owner financing. Will the owner hold the note for a couple years? 

Unfortunately, the only solution may be a bigger down payment?

Why would you lose your down payment? You may lose your earnest money deposit, depending on timelines and contract. But your down payment should not come into play until closing. But I have not seen the contract nor do I know the details of the transaction.

That's an absolutely ridiculous APR. I'm not even sure how you can get an APR that high for an FHA loan. SHOP AROUND!!! (I don't lend in MI, so not asking you to let me give you a quote).

I would definitely heed your attorney's advice.

But in my experience, the lender will rarely call the loan. I've seen it happen only a handful of times in 15 years.

The only issue I would see, is if the original loan was only done with one borrower, then deeded to an LLC with 3 members. That would raise some red flags. All three members should be on the original loan.

Not legal advice. YMMV.

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