All Forum Posts by: Robin Simon
Robin Simon has started 636 posts and replied 3875 times.
Post: Looking for Great Lenders in West Virginia
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
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Quote from @Hunter Ferrari:
Quote from @Robin Simon:
Quote from @Hunter Ferrari:
Quote from @Bobby Feinman:
What types of loans are you looking for and in what areas of WV ?
Buying multifamily investment properties. Looking for something with a lower down payment, preferably 20-30 year term, and a fixed rate. The bank I am working with currently has been offering 15%, 20 year, arms that change every 5 years. I will primarily be investing in the Charleston and Huntington areas.
Some DSCR lenders can offer pretty nice terms up to 8/10 units, rates may be a bit higher but will come with fixed 30-year terms, including options to do IO for the first 10 years. Probably an easier qualification on the DSCR side as well as no tax returns/income verification/DTI vs. what a lot of banks may require
Does Easy Street offer DSCR?
Yes
Post: mortgage brokers near La Crosse, Wisconsin
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Any reason you would need someone local to that specific market? In this day and age, most brokers cover national platforms and can easily connect with lenders across the country that lend in WI, so needing someone super local could really limit you
Post: DSCR Loan Qualifications
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Typically will be about 0.5% to 1% higher than conventional rates, but it can vary. If you are planning to hold for long-term (5+ years), then you can have a 5-year prepayment penalty in the loan which will allow you to pay a much lower rate typically
Post: DSCR Loan Qualifications
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Quote from @Brandon Roundtree:
How do you qualify for a DSCR loan before purchasing the investment property?
You should be able to get a pre-qualification letter or even term sheet through filling out an application and credit authorization and briefly chatting with a DSCR lender to see where you stand. Process shouldn't take more than 30 minutes or so to get a real good look at what you qualify for and what you'll need
Post: Looking for Great Lenders in West Virginia
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Quote from @Hunter Ferrari:
Quote from @Bobby Feinman:
What types of loans are you looking for and in what areas of WV ?
Buying multifamily investment properties. Looking for something with a lower down payment, preferably 20-30 year term, and a fixed rate. The bank I am working with currently has been offering 15%, 20 year, arms that change every 5 years. I will primarily be investing in the Charleston and Huntington areas.
Some DSCR lenders can offer pretty nice terms up to 8/10 units, rates may be a bit higher but will come with fixed 30-year terms, including options to do IO for the first 10 years. Probably an easier qualification on the DSCR side as well as no tax returns/income verification/DTI vs. what a lot of banks may require
Post: BRRR Financing Mortgage Options - Where do I start?
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Quote from @Stephanie P.:
Quote from @Melissa Block:
Hello All,
I just purchased my first 2 investment properties at auction in Louisiana and used cash. I will also reno the properties using my own money. I want to rent the properties out and get a mortgage on the houses to get my investment back out.
Question 1: I was told I would have to own the homes for 6 months before I could get a mortgage. Is this true if I paid all cash?
Question 2: Will I need to make a down payment to get the mortgage and pull my cash back out plus 20% more to give me more cash flow for future investments?
Question 3: What type of financing should I consider? I went to the network section of BiggerPockets, and there are HELOC, Conventional, FHA, Hard Money, etc. I'm not familiar with all of these, nor do I know what type of financing is best for my circumstances. I'm looking for guidance on where I should start to understand my options better.
About me 1: I don't own my own home at this time. The market where I live is super pricey, so I have invested in another state to get my feet wet with investing, so the mortgages will be ones that I can get in a different state than I live in.
About me 2. I'm not a first-time home buyer. It has been less than 2 years since I sold my home due to uncontrollable circumstances. So first time home buyer programs aren't an option for me.
About me 3. My goal is to build a portfolio using the BRRR methodology and position myself to where I can buy my own home. Moving to a more affordable state or area isn't an option for me.
About Me 4: I plan to attend my local Auctions so that I can buy my own home cash at auction within the next 6-8 months, reno it with my own cash, and take a mortgage out and house hack it. I need to position myself where I can buy a house, so the financing I use on these first 2 investments can't hinder that. (I hope this is possible).
About Me 5: If you are wondering why I didn't get these financing questions answered before I purchased the homes, it's because I'm new to real estate investing, and I didn't find BiggerPockets until last week, so I was maneuvering through this world with little direction and sheer determination. What is done is done. I can't look back now and focus on the should've. I have to focus on what I can now control.
About me 6: I have a great credit score, and I don't want my credit impacted to the point where it will prevent me from my personal home-buying goal.
Hopefully, this is enough information to help point me in the right direction. Thanks in advance for your time! I look forward to hearing from you.
Question 1: I was told I would have to own the homes for 6 months before I could get a mortgage. Is this true if I paid all cash? There are lenders that can refinancing using the new appraised value after just 3 months of ownership. You need a good broker that can help you navigate the different lenders and their requirements.
Question 2: Will I need to make a down payment to get the mortgage and pull my cash back out plus 20% more to give me more cash flow for future investments? No, you already own the property, so your cash purchase was your down payment. You'll be limited to 75% of the new appraised value after your renovations and the property being leased, but you should get your money out do to another purchase.
Question 3: What type of financing should I consider? I went to the network section of BiggerPockets, and there are HELOC, Conventional, FHA, Hard Money, etc. I'm not familiar with all of these, nor do I know what type of financing is best for my circumstances. I'm looking for guidance on where I should start to understand my options better. We always recommend you go the conventional rate for financing first. You may not qualify, but then again, you might. There are a variety of reasons why people don't qualify, but if you do, the money is cheapest. Once you've exhausted all of your conventional options, then DSCR (Debt Service Coverage Ratio) money is your next best bet. Easy qualification with higher rate and fees.
Congratulations on your bravery and perseverance. Buying two properties is not easy to do. For additional guidance, feel free to PM me.
Stephanie
These answers are all spot on. I would just add though that in this shaky environment, don't be too aggressive on pulling all the cash out (as Stephanie said, 75% ARV and 100% of your costs will be hard limits), but no need to really stretch on that if cash flow is tight (likely given current market and rates). Especially when starting out, OK to keep some cushion and equity in the properties to make sure are OK if things deteriorate.
Post: Credit union or Mortgage broker/lender recos in Texas
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
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Hi Olu - I would be glad to help, we are down in Austin (hosting a SFH investor meetup in Dallas on Thursday if you are interested!). I will reach out
Post: Question about nonrecourse states & DSCR loans
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Quote from @Sean Bramble:
I'm new to RE and just learned about the 12 nonrecourse states. Couple of questions:
- if a borrower defaults in a nonrecourse state, will an LLC protect them from a big hit to their personal credit?
- are DSCR loans in these states also by definition "nonrecourse"?
- can loans in these states "become" recourse loans if the lender simply asks the borrower to also sign a personal guarantee?
Thanks everyone!
Can you elaborate here? The loan product known as "DSCR" (i.e. the non-QM securitizable market) is pretty much uniformly recourse loans. Are you referring to states in which the borrower must be an entity (LLC) rather than an individual?
Post: Loan options for house hacking a mutlifamily
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
Quote from @Amber Gazzolo:
@Robin Simon it depends on affordability but it looks like 2-4 is more in our price range in SoCal but if rents cover loan cost does that mean I can purchase at a higher price point?
Yes - like the other replies are saying, as long as its 2-4 it can potentially be a conventional or agency loan (or non-QM, non-DSCR), which is the road to take if you can qualify
Post: Loan options for house hacking a mutlifamily
#3 Private Lending & Conventional Mortgage Advice ContributorPosted - Lender
- Austin, TX
- Posts 4,576
- Votes 4,423
What unit range are you looking at?
Typically going to be very different options for:
2-4 Unit
5-~10 Units
11+