All Forum Posts by: Stephanie P.

DSCR doesn't mean "quick close". They still require appraisals and appraisals take time regardless if you pay a "rush" fee.

I'll say it.  Stop the madness.  Get an extension now and don't subject yourself to the hell that you, the sellers, the crazy Realtors and the poor title company are going to go through.  It's not worth the stress and frankly, it's a waste of money to pay for a rush this and rush that when you could be a professional and just tell everyone the financing fell through and you've got to go a different path.  

Usually, I'm the bright ray of sunshine saying "I can get these done", but this is silly.

Nobody's closing in 2 weeks.  It's unrealistic, especially if you're doing 4 loans.  

Stephanie

It's a business purpose loan. Look in to DSCR loans and get it closed. Rates will end up in the mid 7's with a couple points on a 30 year fixed or you can even do a 40 year interest only. No tax returns or paystubs required. Cash out costs more than rate and term because it's more risky.

Sorry to be so blunt, but...

Stephanie

 Location doesn't matter for rate.

We are seeing lot of interest from the lending side in KC. DSCR is still going strong and properties are still cash flowing there.

@Alex Olson, @Evan Rice, @Justin Moy, @Milton Chamberlain, @Joseph Crunkilton, @Randy Smith, @Brandon Carlson, @Steven May, @Snehann Kapnadak, @Caleb Brown

Wanted to give a shout out to those boots on the ground

Stephanie

 What were the issues you had with your "too good to be true" lender?

Short term or long term is really up to the investor. They've got to do some due diligence on the type of investing they want to do. As for the great investor/Realtor friendly agent, someone that focuses on investment properties is a huge deal.  You don't want someone that's only done cookie cutter purchases.  

I tend to like to work with people that come to me as a referral.  Referrals are always best because they are somewhat proven.  One of the worst things a Realtor can do (and lender too by the way) is not pick up their phone, text or return emails or simply respond back in a reasonable time period.  It happens all the time and it's maddening.  Now we try to work almost exclusively with referrals and it's been life altering.

 You're on the right track then.  Well done.

 The best time to plant a tree is 20 years ago.  The second best time to plant a tree is now.  You're on the second best time to talk to a mortgage broker.  It would have been best to have the exit strategy more concrete before purchasing the property.  I would post the particulars of your loan in the Classified section of BP and just let the process begin.  You'll get contacted by every mortgage broker and their Mom.  Pick a couple and ask what their process is like; ask where they are with rates and fees and turn times.

All the best

Stephanie

 @Alex Bekeza laid it out pretty well, but I'll piggyback off of what he said with a real world example. We originated a 9 loan package a couple of years ago that had a 10 year prepayment penalty. Rate wasn't bad; it was in the 6's with a 30 year amortization. I think it was a 10 year ARM. We explained the prepay to the borrower several times in several ways and each time he said "It's okay. I'm never selling these properties. They're my children's inheritance." Fast forward to 2020 and Covid hits. He has no rents because he rents to college kids and they weren't in school. He tried to sell, but the prepay was over $200K.

Rates are better for individual loans also.

 If your first inclination is to sell, then sell.

If you want to keep it and your DTI is too high for conventional, refinance it using a DSCR loan, BUT, make sure the numbers work AND make sure you want to be a landlord. If one or the other isn't a yes absolutely, then default to your first inclination.

Your hard money guy will probably give you an extra 6 months of so for a point.  Talk to them. They don't want your house, they want their money.