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All Forum Posts by: Pat Mulligan

Pat Mulligan has started 1 posts and replied 41 times.

Post: DSCR LOAN INFORMATION

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Nick Velez:

@Danny Jimenez

DSCR loans are my favorite loans to work with but there are absolutely a lot of terrible lenders out there. As you shop around, make sure your lenders will actually lock your rate. When things get iffy in the non-qm space, the first things lenders like to do is suspend locking to hedge their risk (I have even heard of lenders unlocking borrower's). If any lenders have a history of doing this, I would steer clear. Make sure your lender also has a back up solution. If you have to have a DSCR of 1 and you come back at .9, you're dead in the water. Most brokers have access to plenty of lenders that will go no ratio in the event that the 1007 comes in low which is an important safety net.

Each lender is going to have varying guidelines based off their current appetite for risk. These guidelines are ever changing due to how crazy the market is and it's important to make sure the guidelines you are being told now are still in effect when you go get into contract a month later. For example, I was going to utilize a 15% down DSCR on a property not too long ago. The week that I planned on locking it up, our lender let me know that 15% down was disappearing the next day and if I didn't submit my loan same day, I would be out of luck. If I wasn't in constant communication with our lender's I would have never known the product was no longer going to be offered at this time. You can save yourself a lot of headache by following up to make sure the product you want is still available.


I wholeheartedly agree with Nick. I've closed on 2 using DSCR loans. The first one was an awesome experience, and I got a terrific rate- less than 1% of the owner-occupant rate at that time (last December). I was lucky to find a really talented and thorough broker (Jennifer Thompson, 303-903-0716, loan officer in CO). I can't say enough good about her. In my 30 years in real estate, there have only been a few like her who will advocate for the buyer and use their creativity for their client's best advantage.

I have heard that lenders are getting more cautious.  IDK. My second DSCR (Sept this year) was a nightmare and came from a broker advertised here on BP, Truss Financial.  I don't mind calling them out because they should not be in this business. Terrible communication and processing.  The officer never locked the rate and it was 2% higher than quoted by the time of closing, now 8.99% - that is with 40% DP.  All through underwriting, which took forever, it didn't sound like a DSCR at all, asking for a lot of personal financials. Thinking back, they may have switched the loan type without my knowledge(?).  What the heck to do the day before closing when you find out the numbers are all different than you were quoted?  I ended up taking it at a little higher rate so I didn't have a prepayment penalty, and praying I can refinance soon.  Horrible, horrible experience.  They did apologize and offered to refund my appraisal fee, which they never actually did. 

I am no novice and I did call around, checked rates, and interviewed loan originators. I think the best thing you can do is get a lender by referral. -either here through BP Forums (not the BP advertisers), another investor you trust, or from a seasoned real estate agent. It's not about the brokerage, it is all about the originator, as well as the number of programs they have access to. 

Post: Insurance question for STR

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @John Underwood:

Homeowners insurance will not work for a STR.

A STR is classified as a commercial business so you need commercial STR insurance.

There are several different companies that have been mentioned 100's of times.

I found Foremost to be the best and least expensive for me.

 Honestly, I must be doing something wrong. On a 1600 sq ft brick ranch, Foremost just quoted me  $11,000.  with no particular reason, and I know I have a clean record, good credit. The agent said, well Harris County(tx) IS a little higher.  !!

Post: Insurance for short-term rentals?

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Adam Zdunek:

Hey Brian,

Yes, the short term rental will be 2-4 times higher than your standard homeowner insurance and higher than a standard long term rental. There aren't a ton of carriers that have jumped on board in writing STR.

Not 100% sure the carriers in your specific state, but I know that Proper will write in all 50 states. They are one of the highest premiums when it comes to STR, but also have a very good policy too. As stated on here you can look to Foremost as well. They will cover STR houses. You can also check with a local independent insurance agent to see if any carriers that might not have been mentioned have a short term rental endorsement that they can add to a standard landlord policy (Travelers does in the states I write in). You will want to read the policy language to confirm there isn't an exclusion for STR.

Best of luck


Hey Adam! Sounds like you are in the biz----is a monthly rental (MTR) still considered a STR to insurance carriers? our tenants will stay 1-9 months typically.

Post: Insurance for short-term rentals?

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Jessie Leonard:

STR insurance is usually higher. Check with Proper...

Just a little note about Proper.  I originally gave them a good review because of their STR policies. Expensive, but comprehensive.  

BUT....They just canceled my policy because the property had cloth-covered wiring (like most 1951 houses do).  That is an expensive mistake that will follow me til I die. 

Post: South Jersey Multifamily

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Emma Gallagher:

Hello! Does anyone have thoughts or advice on house hacking a multifamily property in south jersey?  Best towns?

There are tons of great towns. Depends on what ' best' means to you.  Can you narrow it down a bit.  Long term hold? Higher appreciation for the short run? STR, MTR?  Price range? 

Post: Woodbury, NJ experience

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Gabriel Santin:

Hello everyone,

I am very interested in a property in Woodbury, NJ for my first house hack. I am wondering if anyone has bought property in the area or knows anything about the town as far as schools, transportation, crime, taxes, etc.

Hi Gabriel!  

Woodbury is my home (and favorite) town! I have family and friends currently living there and I go often as I live in Ventnor.  My mom's family moved there in the '40s; she, me and my sisters, and my nieces are Woodbury High School alumni.   My youngest sister has kids at Walnut Street Elementary and Woodbury HS and my other sister just retired from teaching at the junior high.  I also volunteer with the HS Band Parents.   So, I would say, I know Woodbury like the back of my hand.  I am also a licensed agent in NJ if you need help in that arena. 

To me, it's a typical south, South Jersey small town - but more developed because it is the county seat -- in its heyday, everybody went to Woodbury for their doctors, to shop, eat, etc. Of course, its modern heyday was the 60's and 70's. There are still (or again) plenty of retail, fast food, and a few good restaurants in town. 

Woodbury is about a 20-minute car drive to Philly via the interstate- probably its biggest draw. But it is a pretty town, too. Tons of historical architecture and a charming main street. In 1683, the founders came down the Woodbury Creek that flows east from the Delaware River and through town and feeds 7 small lakes.  The lake parks are great places for casual fishing, bird watching, kayaking, and ice skating, depending on the winter weather. I've heard the better residential areas of Woodbury compared to Haddonfield more than once. 

Woodbury is a historic town, with an awesome past.  It used to be really something in the late 1800s with a medicine factory, a glass factory, and as a  transportation center for the surrounding farms. It has had its ups and downs.  Later on, as the county seat and having the only hospital in Gloucester County( until the small one in Turnersville was built in 1965), Woodbury became very busy with professional offices and a thriving downtown.  Deptford Mall killed Broad St starting in 1978, prisoners started being sent to Salem County jail and the general hospital was recently moved to Mullica Hill. We still have lots of professional offices, but I think that is decreasing as the "locals" folks retire.

Woodbury still has a core of "old Woodbury" families  They really try to maintain the history while making it better. There are also lots of young families moving in-- enrollment in elementary and high schools is growing.  The city had started a few years ago cracking down on what had become a glut of slum rentals, so the look of most neighborhoods is getting better, too.  Retail on Broad Street still has a lot of empty stores but in the last 8 or so years, there has been a small resurgence, thanks to the local chamber of commerce (and no thanks to city council, imo).  What I find most hopeful is the art scene- there are some dedicated artists who are doing a lot in town including teaching the kids and hosting an awesome community fair-type gathering weekly.  There is a really good community there.  Woodbury is small and friendly. Most folks really get along. 

There is so much possibility AND there are a lot of disadvantaged folks living in town.  It is considered a "disadvantaged town" in official surveys. The schools are pretty bad- 2&3/10 on great schools.  The teachers used to stay until retirement but that is starting to go away. Poor administration and high admin turnover, plus the poverty rate, had caused this. Recently hired superintendent of schools came from Camden and brought a lot of Camden educators and admin with him. Some, are not very good. Like who wants to recreate Camden schools, anyway?  I'm related to a teacher and parent and hang around with a lot of them.  These groups talk about the uphill battle to help the kids get a good education despite disorganization and disciple problems. A good portion of middle-class and upper-middle-class parents send their kids to the county technology high school or private schools for K-12. 

Real estate taxes are relatively high at 3%, but a lot of the real estate values are low to compensate for that. It still is a decent market for cash flow, despite the higher taxes. Residents and investors complain about the taxes and blame the city council (most of which gets re-elected year after year, btw). The city council blames the school board. The problems in Woodbury actually come from both groups, but I still have faith. 

Public transportation is about as OK as any in NJ - which is a little more than bad. Buses run on the main roads. Being such a small area, tho- most can walk to a bus stop pretty quickly. The most encouraging is the old train service. If Trenton ever gets to it, there is a new commuter line slated to be built from Camden to Glassboro with a stop in Woodbury. Due to the growth of Rowan, that should be very popular and has already helped boost a less desirable part of town (sadly, I think that excitement has died already). That train line might come in after you retire and I am dead, sadly.

As for crime rates, you can find them on Scout and Niche. They are above the National rate in some categories but look at the residents' poll on NIche- 67% feel pretty safe and 33% feel Very safe in town. 100% feel police are very visible and very responsive.  (and they are- they built a police station that is their version of the Taj Majal a few years ago.  Nice folks, the Woodbury cops (bro-in-law is a retired sergeant). 

As cities' prosperity and desirability move like a sine wavy, I do think Woodbury is still on the upswing- tho very, very slowly. It really depends if the middle class gives up and flees-- I doubt they will, tho.  Like my family, they are involved and have no intention of leaving. The best thing you could do after you buy your house-hacking is get involved in local politics. lol.  Seriously, I think most people would like living there while house-hacking.  Looking for appreciation...... 

 Best of luck wherever you buy! 

P

ps- my new motto:  "my success is only limited by my technological prowess" 

I almost erased this answer by hitting the wrong key. ! 

Post: Top DSCR Direct Landers

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Giora Sela:

I’m searching for alternatives landers for Visio, they are great but I need other options to finance my single family properties as I grow my portfolio. 

I’ve found many landers are charging high fees on top of 2% origination fees while still being at the 8%+ range. 

Hi Gloria! 
I just got a quote from my lender in Colorado.  She only does CO, but her company, CCMC Lending, is in most states.  7.75% on a DSCR. I did not discuss origination fees, but we did a loan with her in January and paid only 1%. 

Best of luck! 

Post: DSCR Loan Products for STR's

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33

Hi Dylan!  

I just talked to my DSCR lender in Denver- she did one in January for us. Rates were the same as in January - 7.75% with 1 point origination fee. That was on a $435K loan. The easiest loan I ever used in terms of paperwork and speed. They did, however, base the value on the appraised full-time rental rates. We rent it as an MTR, which was our intent. I guess you would classify that lender as a #2 type in @Nick Conley's descriptions. 

Best of Luck to you!  

Post: EXIT Realty or Keller Williams, Part Time

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33
Quote from @Joshua S.:

I am currently employed full time as an IT contractor for the Navy (in Norfolk, VA) and am currently in school for my real estate salesperson license. I'm planning to be a real estate agent on the side, part time, and am wondering if anyone can give me any information on who would be the best and most affordable broker to work for. I've heard good things about both EXIT Realty and Keller Williams. My plan is to earn extra income by being an agent so that I can make extra money to invest and also, from what I've read and heard on Bigger Pockets, being a licensed agent is definitely beneficial as an investor.

Does anyone know if Keller Williams accepts part time employees? I know EXIT does.

What fees does an agent have to pay at Keller Williams all together?

I'm starting to wonder if being a real estate agent part-time will prove to be a lucrative endeavor... I've spent $270 on the Real Estate Express course and am approximately 20% finished. My primary goal for becoming a part time agent would be extra money to invest, but with all the fees, I'm not sure if I'm choosing the best route.

Also, does anyone know of any local real estate brokerages in either Chesapeake, Suffolk, Virginia Beach, Norfolk, Newport News, Hampton, or really anywhere in Hampton Roads, that takes part time agents and have low fees and good commission?

Any and all information anyone can provide is welcome and is greatly appreciated.

Post: EXIT Realty or Keller Williams, Part Time

Pat MulliganPosted
  • Investor
  • Ventnor City, NJ
  • Posts 41
  • Votes 33

Congrats,  Joshua, for getting your license.

I worked in the Hampton Roads market for 14 years ( all with Re/MAX). Wainwright Realty is the only agency I know of that is not a member of the NAR. There are still a few small costs ( E & O, e.g) and the split is only 50/50, but if you are only planning to do a handful of transactions / year, Wainwright might make sense. When I moved to Jersey, I joined a traditional firm, and so far, its just been an added expense for me as I am only planing on buying and working with F & F also. I can say that KW has great education, which is so important as a licensee.

Best of luck to you!