All Forum Posts by: Nate Herndon

@Andrew H. thanks for providing all of these details! I'd be looking to use a program that qualifies individuals with as low as a 660 FICO for a 75% LTV cash-out refinance (if desired to leverage that high). The ground rent (aka leasehold) should not be an issue since your 99-year lease will run beyond the 30-year mortgage term, or if it does not, will automatically renew nonetheless.

Any DSCR loan program is going to require a guarantor for the loan that qualifies with some level of credit-worthiness. Closing this in the name of an LLC/entity of your choice would allow you to easily adjust the ownership structure if you are looking to exit the partnership. However, finding a program that disregards personal credit history whatsoever is going to be a tough ask - that's kind of the only thing a lender can hang their hat on as far as the likelihood that they will be paid back.

Here's a peek at what that could look like. Let me know what your follow-on questions are.

@Zachary Russell here's a quick example of the 5-8 unit program that I utilize most frequently for commercial multifamily:

• 75% LTC
• 7.75% interest rate on 30-year fixed term
• 1.20+ DSCR minimum
• Basic DSCR calculation, no expense load: DSCR = Income ÷ PITI
• $350,000 minimum property value ($250k min. loan amount)
• 80% occupancy requirement

Hey Simon, here's what that would look like on a program I regularly use for Cleveland investors. My target closing timeline on a 30-year fixed DSCR loan is always four weeks from receiving appraisal payment.

• Loan summary & application
• Appraisal payment, initial documents requests, title/insurance orders (2-week front-end processing)
• Lender processing, underwriting, closing (10-14 days)

@Neela David here is what that DSCR loan would like for Ohio investors that I work with. The Cleveland area is doing really well for residential investments! Wise choice looking in that area.

Hi @Jane Gold, feel free to shoot me an email and I can connect you with a client of mine who uses the BRRRR method and also does work for other investors in B-ham.

Hey @Casey Graham, I've got a property data tape that I can email your way if you want to send a message my way. It is mostly for the purpose of qualifying for DSCR loans and calculating your DSCR per property, but with a little modification in Excel you could add those additional data points you're looking for.

For sure, would be happy to connect for a call. We broker for that program so I would be your best point of contact on obtaining a loan summary, next steps, etc. Will send you a quick DM.

Hey Jace, the program that I utilize most frequently for my clients includes the closing costs in the LTC calculation, so that helps a little - and they will finance 85% of the project.

• 85% LTC
• Closing costs financed
• Interest on drawn funds only
• Interest deferred until loan exit
• 18-month term

Hopefully that gives you a better idea of what's out there.

Hi @Paul Scammacca - a DSCR loan will not take your personal debt-to-income ratio into consideration. DSCR loans are based on a Debt Service Coverage Ratio, which is calculated as the property rental income (appraised market rents on a purchase) divided by the property debt (monthly principal, interest, tax, insurance). As long as the 'ratio' is a 1.00 or greater, aka breaking even or positively cash-flowing, you can get that loan.

These are 30-year fixed loans for investment properties and do not require your personal income, taxes, or debts be taken into consideration.

Here's a good BP article explaining how you can use these:

https://www.biggerpockets.com/blog/questions-and-answers-abo...

Hey @Eric Fernandez - honestly, these are pretty decent terms given the scenario! I've got a sub-$100k program that I use often and my clients would get something like what is shown below.

Rate isn't wildly important at these loan amounts, though. When you're talking about 0.50% at a $60k loan, that's about a $20.00 per month difference.