All Forum Posts by: Nelson Arevalo

 Just sent you a message 

Hey Jordan

HELOCs are Typically 10-year draw period interest-only payment variable rate, and a 20-year repayment period.

I would go with a bank/credit union for a HELOC as the majority of them don't charge for closing costs. I would look at what meets your needs. If you need a higher Loan to Value Credit Unions would be the best route, and then look at who offers the best rate and terms/fees

I know a few contacts I can connect you with for a HELOC. Just sent you a Direct Message

 Hey Areeb, 

Most of my clients have started their real estate investment with their Equity. In my experience with Equity LOC and Equity Loans (10 years in banking)

On a HELOC you only owe what you use, this gives you flexibility and allows you to strategize, and gives you time to make the right decision in your real estate investment Is always there if you need it. pose to a HELOAN, where yes, rates on a HELOC are variable but HELOC rates are typically lower than HELOAN. On a HELOAN is a lump sum so you will have payments of the terms given automatically regardless if you use the funds or not.

In your case, because you have a plan of purchasing multiple properties, it will be multiple transactions instead of just one investment property, this is where the flexibility of a HELOC comes in.

Hey Fata, I just Messeged you with the contact info of an investment group I know of and work with. In southern CA

Recently DSCR (Debt Service Coverage Ratio) for residential properties has been the talk, you probably have seen most loan officers market the heck out of these in recent months! It's been a great alternative that some lenders have expanded their DSCR to 5 - 8 Apartment Units. Making it accessible for investors.

It has some of the same guidelines that DSCR for residential properties for 1-4 units, but it also has some similarities to a commercial transaction, one of them being a lower loan to value.

So what's the difference between a DSCR loan for 5 - 8 units and a Traditional Commercial Loan?

The main difference is the terms, DSCR terms are 15 and 30 years fixed and 30 and 40-year interest only options, there is more leniency as to Minimum Credit scores, Vacant units, and DSCR coverage.

Commercial loans are typically shorter terms with a balloon payment at the end of the term and are more strict regarding the cash flow and investor/owner finances/assets.

Nelson Arevalo

Multi-Family apartment buildings 5 or more units are zoned Commercial and therefore fall under commercial loan guidelines. Commercial loans are full documentation with a full income analysis, making it hard at times for investors to get into 5 plus units.

Recently DSCR (Debt Service Coverage Ratio) for residential properties has been the talk, you probably have seen most loan officers market the heck out of these in recent months! It's been a great alternative that some lenders have expanded their DSCR to 5 - 8 Apartment Units. Making it accessible for investors.

It has some of the same guidelines that DSCR for residential properties for 1-4 units, but it also has some similarities to a commercial transaction, one of them being a lower loan to value.

So what's the difference between a DSCR loan for 5 - 8 units and a Traditional Commercial Loan?

The main difference is the terms, DSCR terms are 15 and 30 years fixed and 30 and 40-year interest only options, there is more leniency as to Minimum Credit scores, Vacant units, and DSCR coverage.

Commercial loans are typically shorter terms with a balloon payment at the end of the term and are more strict regarding the cash flow and investor/owner finances/assets.

Nelson Arevalo

Multi-Family apartment buildings 5 or more units are zoned Commercial and therefore fall under commercial loan guidelines. Commercial loans are full documentation with a full income analysis, making it hard at times for investors to get into 5 plus units. 

Recently DSCR (Debt Service Coverage Ratio) for residential properties has been the talk, you probably have seen most loan officers market the heck out of these in recent months! It's been a great alternative that some lenders have expanded their DSCR to 5 - 8 Apartment Units. Making it accessible for investors.

It has some of the same guidelines that DSCR for residential properties for 1-4 units, but it also has some similarities to a commercial transaction, one of them being a lower loan to value.

So what's the difference between a DSCR loan for 5 - 8 units and a Traditional Commercial Loan?

The main difference is the terms, DSCR terms are 15 and 30 years fixed and 30 and 40-year interest only options, there is more leniency as to Minimum Credit scores, Vacant units, and DSCR coverage.

Commercial loans are typically shorter terms with a balloon payment at the end of the term and are more strict regarding the cash flow and investor/owner finances/assets. 

Nelson Arevalo