All Forum Posts by: Taylor Scott Siemens

@Jason D. The borrowers loan stays at $400k, it never goes above that.  The $425k is whats paid to us for the loan being that we're direct lenders.  

If the borrower were to put the lender rebates in a savings account, in roughly 15 years theyd have $400k to pay off the loan lump sum. 

@Jay Hinrichs- You are correct, that is why we wait 6 months.  Anything before 6 months results in a charge back.

Hey James,

Good luck with your move and property search!  I recently wrote a blog on how to use refinances as a stream of income.  Works great for multi-unit properties and would definitely help with the high costs of that area.  

https://www.biggerpockets.com/member-blogs/11934/84488-getting-paid-to-refinance-every-6-months-bi-annual-refinance-program

Let me know if you have any questions and good luck!

Hey Simon,

Check out my latest blog post.  Might be of interest to you in order to get additional cash flow out of a rental property.

https://www.biggerpockets.com/member-blogs/11934/84488-getting-paid-to-refinance-every-6-months-bi-annual-refinance-program

Let me know if you have any questions.

@Kevin Sobilo The borrowers loan never goes up and they dont pay a dime for the refinance. We even cover the appraisal.  Theres no huge fees.  The borrowers do agree to take a higher interest rate (5.8-6.1%) but we cover the increase in their monthly payment. Usually $150 more per month.

@Kevin Sobilo We have the same few few companies buy our loans each time.  They make plenty of money on fees.  In some respect, refinancing every 6 months does not make them as much money as a borrower paying out monthly on a 30 year loan.

@Kirby Davis No, this is available on primary, secondary, rentals, and multi units up to quadplexes.  Rental properties are usually only sold for 4.2% premium compared to the 6.2% for primary loans.

I would not be surprised if thats the way these cities go.  It would force commuters to look into other modes of transportation besides driving their commuter everyday.

Yes, its a very lucrative way to invest in real estate or simply be mortgage free in a fraction of the time.  And I appreciate the networking Francis.  Once my borrowers have a few properties renting and refinancing at the same time, their income snowballs fast.  

@Zack Karp No way! I hadnt heard of anyone else that does this too.  And I created the name for my own marketing purposes but that entirely what we do here in southern California.  Its easy to find loans in the $300k-$500k range which are extremely beneficial for both the borrower and loan originator.  I'm gonna send you a message in a few.

We're direct lenders so we fund the loan, and then sell it for approximately 106.2% the value of the loan(assuming the borrower has good credit & not a jumbo loan). Or, 6.2% premium.  So 6.2% of a $400k loan is almost $25,000. We pay for the refinance and our overhead, and then split the rest with the borrower in the form of a lender rebate (check).  A typical $400k loan nets the borrower approximately $13,500 per refinance, or $27,000 a year.  Or $405,000 in 15 years.   

And yes, we refinance the same loan every 6 months.  6 months is the amount of time required by most financial institutions so they do not charge us back the premium.

Ya, it is frustrating when you take into account gas prices, car registration prices, price of gas, property taxes, state taxes, traffic, etc...  but salaries and weather arent close in much of the rest of the country.

The high CA prices can be turned from a negative into a positive.  We developed a program that helps homeowners with their payments, paying off their loan faster, or an additional stream of income.  It works best because of the high loan values needed for most properties.  

https://www.biggerpockets.com/member-blogs/11934/84488-getting-paid-to-refinance-every-6-months-bi-annual-refinance-program

Hey everybody,

Just joined yesterday and absorbing as much info here as possible.  I'm looking forward to giving as much as I take from this community.  I am currently a loan originator in California working for a small bank.  We primarily offer our clients a program called the Bi-Annual Refinance Method.

The basics are, we refinance our clients loans every 6 months into 30 year conventional mortgages.  We sell the loan for an approximate 6.2% premium.  We cover the full cost of the refinance and then split the premium of the sale with the borrower in the form of a lender rebate (tax-free).  We're able to give our clients enough of a lender rebate each refinance that if they were to save the money in a basic savings account, they would be able to pay off the loan in cash in 15 years or less.

For example, a 400K loan earns the borrower approximately $14,000 per refinance.  $28,000 per year.  $420,000 in 15 years (not including interest earned in a savings account).

Pretty cool program since borrowers can refinance as many times as they want and the IRS/RESPA has deemed rebates legal, tax free, and good for competition.

This is obviously a very basic overview but very lucrative and beneficial for the borrower.

I look forward to meeting and interacting with you all!

Taylor