All Forum Posts by: Ash Hegde

Congrats on growing your portfolio enough to max out on conventional loans! Private money is an option, as David mentioned, if you know some interested people. With lenders, Debt Service Coverage Ratio loans are probably going to be your next step. 

The rates are usually about 2% higher than traditional.

For underwriting, they will be interested in your personal credit score, but not your personal income documentation. They will need to appraise the property value and the fair market rents. Your rents will have to cover the mortgage payment. With the rates being higher these days, that is usually going to mean higher down payments (possibly 30%) but it will depend on the lender and the deal. 

None of this is good news compared to traditional financing, but it's the best option to keep you in the game and keep your portfolio growing. 

On the purchase/rental side, it really depends on the market you are buying in. You may find it challenging to refinance your cash out if you go too small, but 125k is enough for many lenders to work with. 

Welcome to the forums Candace! 

I don't think they'd have an issue with this arrangement. They will be looking at the long term lease that you have with your renter for their DSCR calculation. As long as you qualify on those terms, what your renter does with the property after that is between you and the renter.

The cost as a percentage certainly goes up when there is a smaller loan, as processing and underwriting work is the same on small and large. How soon are you supposed to close? It might be worth getting another quote. 760 credit should not negatively impact you. 

For a fix and flip you will want hard money. 

Welcome to the forums Luis! 

Hey Seth, if you are trying to use the money that soon I would not put it into stocks. Long term, stocks are great, but they are too volatile to count on in a short time frame. I would just use a high yield online savings account. 

Good luck this season, with a wrestler mentality I'm sure you will do well in real estate (or anything). 

I would ask the lender. Some will do a drive by appraisal based mostly on comps and some will do a full appraisal. If they are doing a summary/drive by appraisal, let them know about the renovations and ask if you can get a full appraisal if you disagree with the summary valuation. 

As mentioned, an appraiser will give an ARV for both loans as well as rental estimates. Are you working with an agent who knows the area? They might be good at providing estimates but won't have the final say.