All Forum Posts by: Stephanie Medellin

@Joe Maron  If you are employed by a family member you will be scrutinized more than a regular W2.  They will also want to know that you don't have any ownership interest in the company.  I wouldn't advise trying to deceive the lender by trying to create loopholes.  Are you in the same line of work?  You may be able to find a loan with one year tax returns.

@Jon S.  That's great news, congrats!  I learned something new too - I didn't realize you could access all those receipts with a Pro account.  I think I've signed up for one at some point.  That would really help to track expenses.

@Jon S.  If you can't figure out something on a Home Depot receipt, you can always type the item number on the receipt into the search bar on their website and it will come up.  Not always, but usually we buy the same category of items in each shopping trip, so if I can't figure out what materials are on the receipt that's what I do.  Works for Lowes too - they have shorter item numbers!

@Hugo Navarro  Yes, you're right most hard money lenders do want you to put some money down.  It's still a benefit for most people because otherwise they wouldn't be able to obtain financing on a property in poor condition.  

Once it's fixed up and in good condition, they are able to do a cash out refinance based on the higher value, which will pay off the hard money loan and also give them a bit of cash at closing.  They then use that cash as a down payment for the next one.  This way, you don't really have to come out of pocket for each additional down payment, and your tenants are paying rent to cover the mortgage on the 1st property.

They are just finding good enough deals to cover all the costs and still have enough equity left to be able to reinvest.

@Hugo Navarro  You won't be approved for a conventional refinance if the property is listed for sale.  You might want to look for a short term bridge loan, but is it really worth the fees if you're selling so soon?  You're better off pricing it right at market value, (which is good practice anyway - you don't want to overprice!) and go under contract quickly.

@Jay Coombs In a purchase, the "V" in LTV is the typically the purchase price. As the other responses mentioned, the value will be the lesser of the appraised value or the purchase price.

So in your example, purchase price is 65K, the appraisal comes in at 90K but the value for loan purposes is still only 65K. If your down payment is $0, you would be at 100% LTV, which is very hard to find.

@Hema Dasarathy  What a great story and that's very impressive what your Mom accomplished.

You already received some good suggestions, especially refinancing the properties into only one person's name assuming you can qualify individually.

Considering you have an ARM on two of the properties, it makes sense to do a cash out refinance and secure a fixed rate for the long term. Remember, once you've acquired that 11th financed property, any other refinances you do on your existing properties (1-10) will not be able to obtain conventional financing.

@Ryan Moore Lenders are looking at your minimum monthly payments on the cards and how that factors into your DTI. Open accounts that are not being used should not be an issue.

@Gabriel D. Zapata  You mentioned you're a first time home buyer - are you trying to buy a home for yourself to live in, or your first rental property?  If you're looking for investments and focused primarily on pre-foreclosures, be careful of the laws in California.  If you're targeting people who are about to lose their primary residence and you don't intend to buy the home for yourself (to live in) you need to provide certain disclosures to the seller.  Look up: Notice of Default Purchase Agreement.

@Baxter Richardson  These programs are only for buying a primary residence.  One of the benefits is being able to omit student loans in forbearance or deferment from your debt to income ratio to help you qualify, and still have a low down payment.  I am not aware of any for investment purchases.