All Forum Posts by: Stan C.

I called the lender that is asking for 20% down and she said it will be a NON-recourse loan. They are outside of Fannie and Freddie and thus are allowed to get less than 25% down on residential investment props. However, she said my loan will be sold to another bank after closing.  Should I be concerned about it?  Will the agreement specify that it's a non-recourse loan? If so, the new note owner can not change is to a recourse, am I right?  

In fact, not one but two major lenders are offering me 25% down non-recourse loans...

I'm looking for a lender who can offer a conventional loan on my first investment property (a duplex) for buy-and-hold in NC. A local lender offered what I think to be a recourse loan (I will verify it tomorrow) at: 

- 30 years fixed, 20% down, 5.5% rate, no points. Or 5% rate with $2,500 in points, or 4.375% with $5,000 in points.  As I understand it, this is a non Fannie Mae loan and thus - recourse. 

Another national lender offers a Fannie Mae non-recourse loan: 

- 30 years fixed, 25% down, 5.375% rate with $374 in points, or 5% with $1,571 in points. 

I was told by the second lender that Fannie Mae loans for multifamily investment properties start from 25% down. 

Is it worth paying extra 5% in downpayment and slightly higher rates for a non-recourse loan which guarantees them not going after my assets except the property as collateral in case of a default,  - or - lower down and somewhat better rates but with a risk of them going after my W2 wages etc in case of a default?

Thank you! Which state should I register DBA in? Rental or residence?

Should I put insurance and utilities on DBA?

Hi all. I'm about to purchase my first investment property. It will be managed by a PM company. After carefully thinking I decided not to go LLC rout yet. But I want to create a DBA ("doing business as") which is a fictitious business name. Thus, a few questions.

1. I live in NY, property will be in NC. Which state should I create the DBA in? County Clerk's office of the county where the property is located, or in my home county in NY?

2. Do I need to apply for EIN in order to open a business account? Or can I get a business account without an EIN? Do I need an EIN? 

3. Will my DBA's address be on the lease? If so then I need to open a PO Box. Otherwise I guess my home address will be sufficient since tenants will deal with the PM company, right? But contractors... is it a good idea to hide my address from contractors as well?

4. Should I put the loan on my name or the DBA? Title? What about insurance, taxes, utilities???

Thank you!

@John Mocker, I PMed you. 

 Many thanks! I will do a research on AM Best, Standard & Poors. I didn't think of any insurance rating services. If anyone else can recommend other services - please post them here. I'm this info can be vital to many investors. 

 Do most liability policies cover legal defence fees in case of a lawsuit by a tenant against a policyholder? 

Is there such a thing as one liability insurance provider being better than others in terms or a chance of paying out liability claims? If so, what is the name of such insurance provider? Property would be in NC. 

This may help me decide whether I'd go the LLC route or sole proprietorship. But this thread is not about LLC vs sole proprietorship, but about insurance providers.

Does anyone know if I'm required to have a flood insurance for a property on Onslow Drive, Jacksonville, NC, 28540. That's Bell Fork / Hawkside area of the town. If not required then is it strongly recommended or not at all?   My loan application was approved in a conditions that I well get a cheaper insurance that the current one, the bank got quotes from 3 insurers that I can choose from, but none of plans offer flood insurance and liability is 100k - 300k. I guess if bank did approve it without flood insurance then I don't need one? 

With regards to crime rates, all sites give different info! This one says it's very high crime rates in this neighborhood of the town: https://www.neighborhoodscout.com/nc/jacksonville/...

This one shows yellow:  http://www.city-data.com/crime/crime-Jacksonville-North-Carolina.html

But Trulia shows completely green - which is safest. Go figure. Any idea? 

https://www.trulia.com/real_estate/28546-Jacksonville/crime/

 Thank you, Sir. That helps.