All Forum Posts by: Robin Simon

Good warning - there is a lot of variability out there with hard money lenders (and by that I mean that a lot of scammers/bad apples out there), quick perusal of their website shows no google reviews and their social buttons (facebook, twitter) were dead links - IMO in this day and age you should never go with a lender that doesn't have a rock solid reputation and track record that can be confirmed with a 5-minute google search and perusal

 I agree with a lot of the commenters - if allowed legally, then by all means do it.  This also shows the danger of "being nice" and not raising rents annually in line with market changes, that can lead to situations like this where its a rent shock all at once that leaves everyone upset (if you would have raised gradually over the past years, it wouldn't even be an issue)

A "DSCR" loan from a private lender (nonQM) is probably your best bet. These tend to have the best terms for qualifying STRs (don't take into account W2 income, tax returns or any DTI) and can be flexible on the underwriting of the potential income. Also, they are very flexible for structuring with partners (LLCs, splits, etc.) and some lenders will even take into account the higher of multiple partners' credit scores to qualify for the best rates and terms

are you looking for more long-term perm debt rather than hard money?  (i.e. 30-year fixed rate loans on cashflowing, fully operational (no rehab) properties)?

There is a new product from some DSCR lenders that has come out in about the past year that has offered a great deal (albeit with pretty high rates) for 5-8 unit properties underwritten like a SFR - no tax returns, no income verification/DTI and no expenses taken into consideration except for property taxes and insurance. This would be a 30-year fixed rate term. If you go the bank, credit union, small balance commercial, agency multifamily lender route, you'll get better rates, but will likely have much more scrutiny on qualifying and likely lower leverage and quicker amort

Welcome, I've seen a ton of people have success in these markets and doing STRs in North Carolina, I think there is definitely still opportunity there and a great place to invest

first time - I would think to do the higher-value (assuming this means more turnkey, less risk/work).  You are going to inevitably make a lot of mistakes ("learning experiences") just starting out, in my view its better to have less risk on your first projects and more opportunity to still come out on top even after absorbing rookie mistakes

Having a local lender is just not that important anymore - there are lots of great lenders and brokers that have national platforms and can originate a loan perfectly fine w/o meeting at a brick and mortar location.  In fact, you will likely get better terms (fees/rates) than at an old-fashioned local bank since forward-thinking national lenders are likely not to have bloated/outdated costs.  The world is changing with technology and real estate is notoriously slow to adapt

Never heard of them but I just checked out their website, I'd be...skeptical. Looks like they are advertising rates at 6% for hard money fix and flip and 5% / 90% LTVs for rental loans (presumably DSCR). These are way off market so smells fishy

Yes but not necessarily - sub-1.00x DSCR loans are still available and workable with a good, flexible lender. For example, the property might not have 12 months of operating history proving cash flows and might not cash flow if used as a long-term rental, but would still be a workable deal for a DSCR loan. The DSCR underwrite also only takes into account property tax and insurance expense for expenses (no repairs, capex, utilities, etc.), so its a light underwrite