All Forum Posts by: Ko Kashiwagi

Hi Matthew,

What would be the exit strategy to exit out of a HELOC if you are putting it on a rental? Typically HELOCs are used for short term purposes, so it would make more sense if you are doing a flip. If there is no exist strategy, it would make more sense to do a HELOAN or a refinance.

Hi Cliff,

Traditional financing tends to have 12 months seasoning which is why a lot o investors tend to use non-traditional financing like DSCR.

Hi Davon,

As others have mentioned, if would not matter whether it is on market or off market. You'd need to make sure the property is in rentable condition and that the rent will be high enough to debt to cover. Not all DSCR programs allow first time home buyers, so if you don't have a primary residence, make sure to you qualify for the specific program you are looking for.

Hi Ismael,

You can get a HELOC on the 2nd SFH (your PRIMARY) assuming you qualify and there's equity to pull. Line of credit is usually on your primary not on the investment property. You could get a DSCR financing on the 1st rental property you have to come up with funds.

Hi Steve,

Have you discussed numbers with the seller?

Hi Sean,

Was the 8.5% rate for a 75% LTV?

Hi Aaron,

There are DSCR and portfolio products that allow 80% LTV, but this is assuming the property debt to covers. Given a value of $425k, you property would have to rent out pretty well to debt to cover. Rates will be higher as you may imagine.

Hi Christian,

What is the projected rent looking like? I know Cleveland properties can have great cash flow so you can start there. A key question to ask is - is this an area you'd be okay renting? There are severals reasons to not keep a rental like high crime, high vacancies, tenant laws, bad cash flow, opportunity cost, etc. If you don't mind keeping it, it's probably a good idea to rent out.

Hi Rebecca,

Local banks/CU will probably be your best source for this. They tend to have limited leverage and higher interest compared to other products like HELOAN or DSCR, but if you desire a LOC, I'm sure they're out there.

Hi Zak,

What is your specific cash flow goal? Are you satisfied with a positive number or are you looking for 5%, 7%, 9%+? It's not hard to find deals that are are 5%+ but if you are aggressive (ex. 15%), it starts to get difficult in this market. Personally, I prioritize land lord friendly states because this significantly reduces risks.