All Forum Posts by: Stephanie P.

I just saw a post where four non licensed lenders all say DSCR is so easy peasy. With rate of 8 plus tax and insurance it takes a huge down payment to cash flow plus reserves.

No bid Friday means some shops close as they max'ed their warehouse line and are unable to fund deals in process. Only option is to bump and scratch at a loss, or hold and pray for rain.

300000 house 80% ltv payment $2170 (appraiser determines market rents) no HOA you need $70000 plus all your bills including new one times 12

@Caroline Gerardo I totally agree with you (I think!) - you need to (1) be in a strong financial position to use them, and (2) make sure you're getting a fixed rate. 

 I disagree so strongly. But I also think the appraisal market is a racket which will probably get me some objections. I have considered becoming an appraiser because I can charge $1000 to tell people the price they willingly agreed to is fair. Easy money for me. Anyways appraisals are for lenders not borrowers and rarely consider a property bought/sold off market as a comp.

@Andrew Rader

Curious what type of rates they have on those types of products?

I have a rental property I owe for over 10 years.

Current lender refused to do cash out refi since it’s investment property.

My two previous attempts to cash out refi would make the property into negative cash flow operation.

So I decided not to purse them.

The only valid option I can see is to do potentially 1031 exchange.

What do you all think?

Respectfully,

Oleksandr

I have two properties, one in MI & one in SC. SC property was purchased on a fix and flip loan, we decided to keep it and need creative financing. My credit score took a hit, as we used cc to fund the fix. Lots of equity (in both properties) just need someone to hold the note for a year or two, until I can get back on track. Any ideas??

“Well you can always just state your intent is to make it a primary residence. Once you get the property then whatever, life happens you may change your mind if you catch my drift” - this was followed by a laugh.

That’s what my lender said to me when I asked him if there were any loan options for less than 20% for a second home/investment property within the same city I live in. (Midwest college town) I used this same person for my primary residence about a year ago.

After reading online it appears to be mortgage fraud, but if life circumstances change it’s kind of a grey area

Is this actually an option? How risky is it if the loan officer is basically suggesting it. This would be a visible property on Airbnb. I wouldn’t have considered this as an option if the loan officer didn’t suggest it.

Hey there BP forum! I hope you are all chasing your dreams and making things happen. I need some direction or advice on best approach to funding my first investment property. My rookie REI journey has provided me numerous situations where analysis paralysis has eaten up a great deal of time and progress, I'm there again. I am looking to do a cash out refi on a second home I own in PA to invest in Charlotte, NC.

My credit and income are good to go and do not create any barriers. The below is based on refinancing from 11 years remaining on a 15 year note at 4.25%, $1860/month PITI.

Conventional Lending: 

OPTION #1 5.375% on a 30 yr. at 60% LTV providing $130K PITI $2178/month *** No appraisal needed

OPTION #2 5.875% on a 30 yr. at 75% LTV providing $185K PITI $2563/month *** Appraisal needed

I found a quadplex for $505K with positive cash flow. I backed out the monthly note, 5% for vacancy, 5% for break fix, and 8% for PM and net out $650/month. I could pull this off using OPTION #1and have this one location to kick things off. Or, use OPTION #2 and buy a 3/2 SFH in addition to the multiunit. I likely would be net neutral on the SFH but garnering the potential appreciation of the Charlotte market.

Here are my points of contemplation:

- I don't want to overextend myself by taking out the 75%.  When it is all said and done the new mortgages on my 2nd along with the multi unit and the 3/2 would be net neutral.  I am okay with that but would be digging into my own pockets for those surprises that present.  

- The refinance process is a nuisance and costly. If I am doing it now I may as well take full advantage of it and pull out as much as I can.  Downside is that I would be $700 more per month out of pocket.

- Having 40% equity is nicer/safer than 25% equity.  My parents live in the PA property so I want to ensure things stay copacetic.

- Appreciation on 3 properties has a great deal of potential upside.

- If I don't do it now it sets me back from scaling up in the future.

- Should I be considering alternatives to conventional lending?  Between my primary home and 2nd home I have about $625K in equity with great credit and income.  The quadplex is fully rented with leases and deposits that convey.

I believe David Greene would be all in.  Am I wrong?  I don't have an overly specific goal as things sit today due to the general uncertainty of the financial environment we find ourselves in.  I do however want to scale up responsibly while embracing a sense of urgency.  I feel pretty confident that the market here in Charlotte will be pretty stable and continue to grow.  I am in my late 40's and want to take advantage of my resources.  What thoughts do you have?  I would love to hear a few perspectives.  With Great appreciation!  

 lol this is the perfect example of why I think lenders just don't understand.
I own a company that buys off market properties, literally everything we buy is discounted and often they are nice houses not just distressed ones.  
The price I'm buying at doesn't make it market value, and I'm in a non-disclosure state so it's not super easy to find out how much I purchased a property for.  And if it was market value I wouldn't be buying it.