All Forum Posts by: Steven Goldman

I agree with Sasha. Brokers are familiar with the numerous lenders and their policies. I respectfully disagree with Christie as DSCR loans are closed in 30-45 days routinely if you select the right broker and they select the right lender for your deal. The main hang up with turn around time is appraisals. In the extreme seller market place that currently exists the appraisers are not only busy but have increased their fees. Supply and demand. In my opinion you do not have to limit your search to a local lender you will be unnecessarily reducing your options . Good luck!!!

Linh this is a tough one. Because of the low value per unit it is likely only local banks and credit unions would be interested in these properties as a portfolio. The other problem I foresee is you will not be able to release individual properties form the portfolio. Therefore,  its all or nothing. Sorry for the depressing response. But one truth is better than a thousand lies. Maybe you can find a private money lender and offer them a higher rate of return. Good luck!

Columbus is a great market place! If you are buying turnkey you will be able to go 80 percent LTV so long as the debt service coverage ratio and your credit score qualify. I would speak with a DSCR lender prior to your offer to understand your maximum leverage and approximate rate. In this rising rate environment you will not be able to lock your rate with a DSCR lender until the commitment. This makes pre-vetting the loan even more important. If you are willing to use a adjustable rate from a bank than you will be able to get a commitment at the time of application. I do not recommend adjustable products considering the current rate environment. Good luck.

I admire your vision. What you need to do is find an investor who will mentor with you so that you can learn the ropes. Than you need to find a property. Start out small. You will need enough money for a small deposit. Than find an investor, family friend, acquaintance and sell them on the project. Your contribution can be the leg work and the administration. Repeat a few times and you will be in business. All DSCR or Fix and Flip lenders will want someone with 6 months cash reserve before they will lend you money. Your income will not matter.

To build up a war chest you may want to wholesale and use the money you make to fund your deposits.

Initially you will have to flip in order to get your money out to increase your war chest to get going. You need to adjust your vision 10 properties in three years with no money or a job. Not gonna happen. 

The more complicated you structure the deal the harder it is going to be to get financing. The guarantor will need to be a 20 percent owner of the LLC. That does not mean he has to contribute 20 percent of the down payment. It just means in the Operating agreement you have to own 20 percent of the LLC. You can be making a management contribution. Make sense?

Seth if you can find the investor and make him a member of your LLC than you may be able to get a DSCR. lender who would be interested in this deal. Otherwise, a second mortgage to finance the down payment is a universal no go. Wish you the best!

I have been involved in real estate since 1982. I have owned commercial residential, mixed use etc. The best advice I can give you is develop a strategy that you believe in. Make sure it is economically sound. Than execute. Finding money is not nearly as hard as finding a good deal. Be diligent, ask a thousand questions. Their are no dumb questions. 

As you move forward their are many money sources. A  d.s.c.r. lender will work with a lower credit score so long as you have down money. Start out flipping, if you do not have enough money to hold turn key. The possibilities are limitless. Real estate has risks, but it has great rewards. So do not listen to the naysayers. They are paralyzed! Good luck.

Jay all true. 

Debt service coverage lenders will not lend to you as a owner occupier because they are not set up to comply with HUDs notice and regulatory provisions. What distinguishes a hard money lender from the bank is the hard money lender can move more quickly because  an investment property is an exception to the owner occupied mortgage regulations. So, you are mixing apples and oranges. If you are going to hack your  first investment property than you can get a conforming traditional owner occupied purchase money mortgage. That may allow you in certain circumstances to put far less money down. 

If you are buying in cash, to use a hard money refinance strategy you can not be occupying the property. Some hard money lenders will give you 75 precent LTV a few 100 percent, all at a cost. If you want to base the loan on anything other than the purchase price you will have to own the property for at least 6 months and in some cases 1 year, before the refinance. Good luck.

Dustin Ken's advice is spot on. At some point all investors face the D.T.I. challenge. Your best option will be to utilize a D.S.C.R. lender. They do not care about your D.T.I., or how many properties you have in your portfolio. Or, for that matter your W2 income. Only credit score and debt service coverage ratio.  Good luck!