All Forum Posts by: Kristen L Garner

Hi Drew, If you were purchasing it as owner occupied you could put down 3.5% (FHA) or 5% (conventional) - that is good news for the house you are buying for yourself and your wife! But generally speaking, investment properties require a minimum of 15-20% down and sometimes 25% for first time investors or tricky/unique scenarios.

There are some ways to get creative with down payments: seller financing, using an investment loan that allows "gifted funds", etc.

Best of luck! 

Hi Jose! Depending on the loan product used - to purchase a non owner occupied investment property you will need a 15-20% down payment plus closing costs. (different loans have different seasoning periods for your funds and different guidelines on allowing gifted funds - something to consider) To determine closing costs you can call a local title company in your chosen area and ask them for their fee sheet and your lender should be able to provide you with any other fees associated with the loan. I would start with narrowing down a location and property type and then making sure you are connected with a lender so you are running your numbers with accurate data. I'd be happy to connect and chat if you'd like to throw ideas around. I invest out of state as well.

There are many 30 year fixed amortization options! Feel free to DM me if you'd like me to dig into a few of them based on your scenario.

A great loan product for investors indeed! There are also plenty of products with guidelines that allow for under a 1% DSCR ratio. There are even no ratio DSCR products for properties that are hard to find rental comps. However, the higher the DSCR ratio the better the LTV and rate.

I agree with Anne on DSCR. DSCR stands for Debt Service Coverage Ratio and you qualify based on the property itself rather than your DTI, work history, etc. You typically need 20% for the down payment and there are some credit score requirements as well. DSCR only works for investment properties. If it is for an owner occupied purchase you could do a bank statement loan, profit and loss loan, or asset based loan. These owner occupied nonQM products usually require 10% down and have some credit score requirements as well.

If you wish to stick with a conforming product, you may be able to.  If the 6 months of unemployment makes sense with your line of work.  Some lines of work are seasonal by nature - like snow removal jobs, entertainment industry, etc 

Hi Rafa! Is the issue your DTI or is the issue that it is a second FHA purchase within 100 miles of your current primary? Have you owned your current primary for more than a year? If it's DTI and they are giving you a hassle on using rental income from the departing residence - you can usually work around this by ordering an appraisal on that property or showing a lease agreement dated after your departure. If it is the FHA 100 rule - you need a pretty narrative of why you are relocating. If it isn't for a bigger home, better school, work, to be closer to other family, etc then you could switch to a conventional loan. However conventional you need to put down 5% instead of the FHA 3.5%.

 @Kevin S.

Hi Kevin! Legally the loan officer you work with should have an NMLS identifying number. This means they have passed their education requirements, tests, continuing education, background checks, fingerprinting, etc. You can look any loan officer up by their NMLS number here: HTTPS://NMLSCONSUMERACCESS.ORG

Once you look them up you can see what states they are licensed in, if their license is active, what company they work for, the company address, if they have had any regulatory actions taken against them, etc. Many loan officers are only licensed in one state so they only have that one number. I have a long list because I do business in many states. Some states give you a unique license number and some just use your original identifying number.

If the person you are working with is "working under someone else" they may be a loan officer assistant or processor who are not required to have a NMLS number but that would mean they cannot discuss rates with you.

NMLS assigns a unique identifier to each entity that has a record in the system. An NMLS ID is assigned to each company, branch, and individual person when the entity first creates its record in NMLS. Once assigned, an entity's NMLS ID cannot be changed. So you should be able to look up an individual loan officer, their branch, or the company they work for.

As far as picking your lender - You will want to make sure you work with somebody who not only understands your goals but has products that match your needs. And in my personal opinion - communication is key. You don't want to be in the middle of a time sensitive transaction where your money is on the line and be working with someone who doesn't answer their phone or is slow to respond to emails.

Feel free to DM me if you have any more questions!

Hey Charles, conforming loans will not allow you to close in an LLC. You would need to close in your personal name and then quit claim to an LLC at a later time. However, non conforming loans (aka nonQM) such as DSCR allow you to close in an LLC. Rates are typically higher for DSCR vs conventional but you can offset that with the way you structure the loan - like adding a small prepayment penalty or increasing the DSCR ratio bracket for example. Best of luck!

Hey German, My personal portfolio is in Indiana but I work with other investors who purchase in Detroit.  Happy to connect if you'd like to DM me.  Best of luck! 

@Allen Drial Sure! Within the nonQM space there are products like DSCR, bank statement loans, P&L loans, asset based loans, etc. DSCR is the most popular of the bunch (debt service coverage ratio - basically you qualify on the property cash flowing rather than your income and DTI). All of these products exist with no seasoning period requirements in the guidelines. You just need to make sure the lender you are working with has access to them because some nonQM product guidelines have 6 month seasoning.