All Forum Posts by: Steven Goldman

Mike Davis is correct you would benefit by finding a JV partner who is not the property management company. You want a passive partner who is interested in a long term return on capital and short term income. Multi family investors usually attend their own meetups. I would look for a multi family meet up in your area and outline the deal and see if their are any takers.

There are any number of lenders in the market that will do a stated income loan at a higher interest rate for a owner occupied property. You may have to bite the bullet buy with a non conventional loan and than refinance when your income is qualified. Good luck.

@alexhunt is accurate. Remember that the LTV will be tied to four things.

1. Type of property

2. Credit Score of the Guarantor(s). HML will allow you to have only one member as the guarantor.

3. Projected Fair rental value as determined by the appraiser.

4. Debt service coverage

So, someone who has a conforming property; with a 750 or above credit score; with a 1.2 or better debt service coverage; which is dependent on the fair rental value; will get maximum allowable LTV under the lenders guidelines.

That said: This is why you need to consult a mortgage professional, be it banker, or broker. Good luck.

Karen with self employment income the easiest way to finance a rental property is with a debt service coverage lender. You will need 20 percent down, fees and closing costs to qualify. If the monthly fair rental value exceeds the projected principal, interest, taxes and insurance, than you will qualify without considering your income. A minimum 650 credit score is required. The higher the score the better the LTV and rate. If you have a lower score, you will need more down money. These loans are 30 days to process and at the moment rates are rising. The rates are currently in the range of 6-7.5. I wish you luck.

I get it. So long as you can source your funds on deposit as from legitimate sources they will not be questioned. A funding company does not care about sourcing. As long as it is in the LLC account at time of application and you sign a non laundering affidavit they are o.k. with the source.

Hi Michell: So you will need he necessary down money to purchase the vacation property regardless of whether you use bank financing or funding company financing. Your skin in the game can not be financed with a bank or funding company. The general rule is no second mortgages. 

If you do not have the down money, loan and closing costs you can always find a JV partner. As I have said many times on BP it is easier to find money than a good deal. Good luck!

Hi Rich: Be careful about building a portfolio of inexpensive properties.

I know Pittsburgh has opportunities to purchase these types of properties.

Only local banks and credit unions will be interested in financing on a single or portfolio, which is comprised of under 100k properties. If you are buying these types of properties you must be willing to work with a local bank and accept a 5/20 or a flat ten year in this space.  Local bank rates for this size deal are 4.5 to 5.5 with very good or excellent credit. Rates are rising fast. Good luck.

Good Morning: Slaiman: If you are not reporting that income then it will not be accounted for in a full document loan. DSCR lenders do not care about your income. So long as you have a 650 or so credit score and the rent covers the principal interest taxes and insurance and condo fees than they will lend you the money. They do require 6 months cash reserve. Also the better the credit score and coverage ratio the better the rate and LTV. Good luck.

So if you use debt service coverage financing your LLC has nothing to do with it. It is based solely on credit score and debt service coverage. D.S.C.R. is calculated as follows: RENT/P.I.T.I .= D.S.C.R.                                                                                                        Some lenders reduce the rent by management fees and or 5 percent for repairs and vacancies. So unless you are trying to borrow money for the LLC as a business loan you need not worry about its credit rating. You will also need six months mortgage payments in reserves in some type of account. It is not escrowed but it is a requirement. You should form a partnership with a mortgage broker and run your ideas and deals past the broker before you commit to them. Good luck.


 

Buying a pre-foreclosure property is about coordinating the sale with the owner and the bank. Any good loss mitigator would advise you that if you are willing to payoff the owners mortgage in full, pay the tax and other liabilities that the bank upon being informed of a sale which covers their mortgage will delay foreclosure to allow you to close. 

here is my advice about the order of tasks:

1. get an immediate title search to find out if their are other liens or judgment's or tax liens.

2.If their are not: Draw up agreement of sale. When signed:

3. Advise the lender that you are in need of the payoff and are buying the property and request a postponement of the foreclosure.

4. Settle on the property. Make sure that the owner has moved out prior to settlement. Do not let the owner remain in possession after closing or you will have a big issue on your hands. Good luck.