All Forum Posts by: Kyle Deutschmann
Kyle Deutschmann has started 8 posts and replied 387 times.
Post: DSCR Loan Question
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Donyea Jenkins:
With this loan, do properties have to be "Turn Key" to qualify or can they be used on fixer uppers?
As others have mentioned, DSCR loans are generally for turnkey rentals (although outdated rentals may still qualify depending on the level of deferred maintenance). However, an easier option would be to use a bridge loan to help with acquisition and rehab financing if the property needs some work. Happy to chat about financing options if you have a BRRR deal you're eyeing.
Post: Best Ways to Secure Capital for Real Estate & Business Growth?
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Stacey Wells:
Hey everyone,
I’ve been researching different funding options for real estate investments and business expansion. Traditional bank loans can be slow and have strict requirements, while hard money and private lending seem to offer more flexibility.
For those who’ve secured funding before, what’s been your experience? Have you found any creative ways to access capital quickly without jumping through endless hoops?
Looking to hear from investors, business owners, and anyone who’s navigated this process successfully! Let’s share insights. 🚀💰
You're spot on from your assessment so far. Conventional financing is a great option to get started if you have a W2 job or easily verifiable income and you're financing a 1-4 unit property. You can generally get the best terms (max leverage and best rates) on an owner-occupied house. However, they will certainly require you to jump through more hoops compared to private and hard money lenders.
Some private lenders like the one I work with doesn't require appraisals on fix and flip/new construction loans and also doesn't require tax returns/W2s. There is still some paperwork involved but significantly less than traditional lending institutions.
Post: Refinance on Investment Property
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Stacie Telles:
Hello all, I inherited a duplex fully paid off. I took out a mortgage on the property in November to help make repairs and rent it out. The loan amount was for 153,000 and the property was appraised at 220,000 before repairs. Repairs will be done this February and both sides will be rented out. Will the bank allow me to refinance the property again to tap into equity after the repairs and new appraisal? I would like to put the money into purchasing another investment property. Thanks in adavance for the information!
Some lenders will allow you to go off the appraised value with less than 6 month seasoning, if you did work to the property like you did. Happy to help if still shopping around lenders.
Post: should i use hard money to grow quicker
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Sabian Ripplinger:
i want to possibly use hard money this year to grow quicker and can you use them for new builds who should i use and any tips? ( im in Wisconsin )
You can certainly use hard money lenders for new builds. The benefit is significantly less red tape compared to working with your traditional local banks who also do new construction financing. Most hard money lenders will want to know about your track record - if you have no experience, partnering with someone who has a track record will likely be an easier path to approval (and likely higher leverage) than applying by yourself.
Post: Cash out Refi or wait
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @David Naphy:
Hi BP community, I appreciate any and all suggestions!
Last year, I purchased a SFH under market at 7.65% interest rate and did some rehab to up the value. As of today, the house rents for $3,400 per month and my PITI is $2,500 per month. There is another house about two blocks over that I have the opportunity to buy off market under market value. In order to do so, I would need to do a cash out refinance of the first property, and was told I can pull out $80,000. If I do this, my PITI would jump up to $3,090, really cutting into any cash flow and the interest rate would jump to 8%. The house that I have the opportunity to purchase, would rent for $3,250 and the PITI would be $2,600. My question is, do I just not touch the first property, use the cash flow to reinvest and pay down the mortgage or save up for a downpayment down the road OR do I pull cash out of the first property to buy the next property? Thanks for all of your help in advance!
Who is quoting you an 8% rate? Depending on your exact situation, you could likely get something closer to 7% and make these numbers work a little better.
Post: Hard Money Lender
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Emil Gonzalez:
Any referrals for Hard Money Lenders in the Bessemer/Birmingham area.
I would appreciate some info on this.
Thank you,
Hey Cesar, the lender I work with lends there, up to 75% loan-to-ARV in most scenarios on 1-4 unit properties. Happy to chat with you if you're still looking for lenders to add to your Rolodex
Post: Hard Money Loan
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Timothy Frazier:
Is it a bad idea to use a hard money loan as a downpayment for a turnkey property? I have one in mind at Rent to Retirement.
I wouldn't do that. Use a DSCR loan (or conventional if you can qualify). Most hard money loans will need to be in first position lien and will generally go up to 70-75% (maybe 80% in certain scenarios) of the ARV. If it's already turnkey that means you're paying higher rates than necessary when you could put 20% down and get a DSCR loan with lower rates and fees.
Or buy something that needs some love and some hard money lenders will fund up to 90-100% of the purchase and rehab. You'll generally still need some cash or liquid assets to get the deal done though even if they fund 100%.
Post: Co-Living (rent by the room) BRRRR
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Jake Baker:
I recently purchased a property in Jacksonville, FL, and plan to execute a BRRRR strategy with a coliving model (renting by the room). The property is in a B-class neighborhood, and while I'm comfortable managing coliving setups, I'm curious about any potential nuances around refinancing and insurance for this type of property.
Are there specific loan types or lending policies I should know when refinancing a rent-by-the-room property?
Do lenders or appraisers treat properties with coliving setups differently?
Are there any insurance policies or providers you recommend for this unique use case?
I would love to hear from anyone with experience navigating these aspects of a coliving BRRRR strategy!
While I agree the rent by the room strategy can be great if you know how to manage it well, from a lending perspective, a lot of 30 year DSCR note buyers won't allow properties with individual room leases, so it could make refinancing more challenging.
Post: New member from Baltimore
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Samantha Suero:
Hi Jaycee, thanks for your response!
The listing for my property is here:
https://www.zillow.com/homedetails/682-Washington-Blvd-Baltimore-MD-21230/36535551_zpid/
I currently have the house listed for $2,800 after decreasing the rent multiple times over the course of 5 months. Interest has been very low since the property has been listed. Any feedback on the listing/suggestions from anyone would be greatly appreciated!
Hey Samantha, welcome to BP! I have two rentals not too far from your property in Ridgely's Delight. Generally I've found the rental market to be much slower in this area in the wintertime, so in the future I would aim to have your leases start and end sometime in the spring or summer when more students, families, etc. are moving.
Post: DSCR without penalty for selling early?
- Lender
- Baltimore, MD
- Posts 417
- Votes 205
Quote from @Rich Emery:
Hello BP Fam,
Most DSCR lenders I've spoken to have a penalty for selling a property within the first 5 years of purchasing the property. Does anybody know of a lender that has DSCR loans that do not have this penalty? Or maybe not as severe a penalty as I've heard so far? What I have heard so far is 5% penalty within 1st year, 4% in year 2, 3% in year3, etc.
Let me know your thoughts!
Thanks!
Rich
We can do DSCR loans with no prepayment penalty. As others have mentioned, the rate will be higher compared to a loan with a 5 year prepayment penalty.