All Forum Posts by: Stephanie P.
Stephanie P. has started 186 posts and replied 4622 times.
Post: Experience with DSCR Lenders
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Mark Maynard Jr:
Does anyone else seem to have the same experience when applying with DCSR Lenders?
Background:
I am currently working with a lender in New Jersey who calls themselves BRRRloans, parent company Orbit Capital. I have to say my experience has been one of the poorest I think I have ever seen in the financial world. We have a fund of 7 figures that we use to purchase properties cash, rehab, rent out, etc; with two partners with super high credit. We qualify for top tier mortgages, and do pass conventional financing tests, as we both have other manufacturing businesses that are adequate for cash flowing these things.
Are there any of these lenders out there that react in a timely fashion, and have halfway decent rates? I am attempting to close two of them at 5.65 with 2 points this week, and it seems like I am pulling teeth to even get a response email. I dont really consider myself too pushy, but today alone I had to text the guy Joel 3 times just to get an answer out of him regarding one of the documents being in error. I understand the rates have gone up, market is the market, but I still did want to just see if anyone else had a positive experience with customer service and found the rates to be fair. Im not the guy shopping for a quarter point all over the place either, just looking for a direct lender partner who actually cares about the customer base a little more then what ive got now. Saying one thing and doing another is a major character flaw for me.
I attached an actual email with a rate quote to closing, and then a copy of the document I just literally had to beg for for closing. Can imagine what a surprise it was, especially after telling me he would eat the points after having to raise the rates because of a mistake that he agreed he made.
It's unfortunate. When markets move, sometimes people get caught. The best way to handle it is to tell people what's going on and let them make decisions for themselves. I'm thinking they're hiding because those rates aren't available and they want the lock to "expire". Hopefully I'm wrong, but probably not, especially at that LTV. If you can get 5.625% and 2 points right now, you're right to want to close it. That rate/term at that LTV is not available from any of my lenders.
Hopefully, I'm wrong.
Stephanie
Post: Looking for lenders - Cash out refinance
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Arman Ali:
All -
I have purchased my first SFR and and challenged by the refinance portion of the BRRRR with interest rates going up.
One particular challenge is that Fannie May and Freddie Mac have a clause stating that you need to hold the property for at least 6 months before refinancing. Interest rates are expected to go up next month and I am trying to see if there are lenders out there that do not have this requirement. Any input helpful!
The 6 month seasoning guideline isn't new and shouldn't be a revelation. Did you use a lender for the acquisition or did you pay cash? If you used a hard money lender, they should have told you about the seasoning requirement. Most DSCR lenders require 6 months seasoning to use the new appraised value also. There are a few that allow the refinance to go below that, but the refinance may be based on acquisition plus renovation costs or have some other calculation that doesn't allow the full appraised value. You will probably find that you're pretty close to the 6 month mark once the property is stabilized and when doing the math, realize that the best course of action is to use conventional financing if you can.
Stephanie
Post: Are DSCR Loans Still "Worth It" with Spiking Rates?
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Welcome to BP!!
Your scenario is really well laid out. Lots of variables in today's lending space. We have a lot of borrowers going for the interest only option.
To answer your question, in areas where a DSCR didn't make sense before, it probably won't make sense now, but it's all a math problem. As rents continue to rise, I believe we'll see a resurgence in DSCR if the current rates hold.
Stephanie
Post: Lender have to be licensed in buyer’ state?
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Tim Sharkey:
I have a NY LLC client looking to buy a rental property in Philadelphia, PA.
Question: does the lender have to be licensed in PA ? NY? Can it be a lender from another state without a license in either of these states?
Thank you!
Depends on the lender. Some DSCR lenders allow PA and others do not. A license IS NOT required to originate DSCR loans in more than 30 states. They are considered "business purpose" and fall outside RESPA as @Jared Rine has said.
Post: Travel nurse trying to invest in REI, need advice.
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Catherine Javier:
Quote from @Marie Griffin:
I need some advice. I'm a travel nurse "2 years". I just purchased a new build home in May of 2021 in Florida "used my VA home loan".
My issue is when going to use a conventional loan I'll have to quit my travel nurse job, take up a local assignment to prove I have a "steady" job. "Had to do this with my first home"
I need a lender who understands REI and travel nurse work. I'm never without a contract unless I want time off. They literally throw offers at travel nurses multiple times a day. I need a lender or someone to guide me in the right direction.
My goal is to obtain a condo on the beach, with beach views and airbnb it. Or to do a "BRRRR", near the beach and my home.
Any advice would be helpful.
Thank yall!
Travel RN here. Recently we closed with US Commercial using DSCR Loan. @Stephanie P. recommended it and we worked with Tom Potter. He's great and so patient because we are clueless and rookie. This is our first investment.
Good luck!
Thanks Cathy. You and Lizzie were great to work with. Tom commented to me that you made the process easy because you got him whatever documentation he asked for in a timely manner. Soooooooooo important. @Marie Griffin I'll send you a PM.
Stephanie
Post: Travel nurse trying to invest in REI, need advice.
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Marie Griffin:
ok, thanks yall. I was contemplating the DSCR loan. I'm also going to try a conventional loan first. I have 2 more months to educate myself on all the different loans and options available.
Don't wait too long. Rates are screaming north faster than anyone can keep up.
Post: Second home lender - Durham, NC
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
@Catherine Javier
David is good. I have another local in Washington if you need
Post: Second home lender - Durham, NC
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
I have a few lenders that would do it for you. I think Tom sent you one, but I'll double check. If you need more, PM me.
Stephanie
Post: ARM loans vs. DSCR loans
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
ARMs and DSCR loans are two different things.
A DSCR loan is a type of loan that doesn't require income verification for the borrower. The income for qualification is derived from the rents or the market rent.
An ARM is an adjustable rate mortgage meaning the rate adjusts over a set time period. You can get an ARM for a DSCR loan although a 30 year fixed and lately, an interest only loan, are more popular.
You need to contact a mortgage broker that's familiar with the process so they can assess your particular situation and find out what type loan is right for you.
Stephanie
Post: Chasing a higher DSCR
#5 Mortgage Brokers & Lenders ContributorPosted - Washington, DC Mortgage Lender/Broker
- Posts 4,876
- Votes 2,759
Quote from @Michael Tyler:
I understand that loans based on DSCR are a little hard to come by right now. But barring this whole crisis...
When seeking a loan that is based on DSCR rather than DTI, is there a benefit to maximizing the DSCR? If I can get it up to 1.5, 2.0, or higher, does it continue to benefit the loan application process? Or is there a point of diminishing returns?
Depending on the lender, there can be a price break if the DSCR exceeds 1.5. In many instances there are breaks when the prepay exceeds a certain number of years (again, it depends on the lender), cash out can change the equation as well as units and interest only. Lots of things change the rate, up and down.