All Forum Posts by: Tom S.

 @Anthony Freeman  Yes, it was a full doc loan, so bank statements, W2, tax returns, etc.

@Anthony Freeman I used SoFi to refi / cash out an investment property at 80% LTV, and they said they could go slightly higher but it would impact the rate.

It was a full doc conventional loan, FICO > 760

@Michael Bieler  I use Liberty Mutual for my umbrella policy and no issues with getting the policy covering multiple rental properties.  Some of the rental properties are insured (fire ins) with LM but most are not, and I use other carriers.  That's not an issue at all for getting the umbrella policy.

@Valerie S.  I find there are two parts of it: the numbers side, and everything is negotiable.  I typically start with 10% down, a market interest rate amortized over 30 years,  and a 7 year balloon, and go from there.  I definitely prefer not to pay more than the appraised value (you should pay for an appraisal).

The other part is the property: issues with it, rehab needed, tenants paying?  You should talk to the tenants as part of the due diligence process.  You want to make sure the owner isn't using seller financing to dump a crappy property onto a newbie.  Don't let their problems become your problems.

Hope that helps!

@A.L. DeFalco  The main item I would be concerned about is that it went "pending" and then relisted, not once but twice.  With price cuts each time.  The agent has to disclose any known issues, so perhaps an inspection was done and it revealed major issues.

@Kyle N. Just curious, why wouldn't the seller just list this property on the MLS for $240k? Even after commissions and closing cots they would be getting their money soon, which they could invest in a safe CD at 5%, instead of the 2.5% over 30 years you're offering?

Be prepared if the seller's attorney handing the paperwork advises them this scenario, and what your response may be. Personally I wouldn't want to deal with all of the unknowns of the transaction, versus just listing it on the open market.

@Jason Sousa  Curious you mentioned the buyer will have a conventional loan - are you sure that lender will allow this?  I would start with that first.  Typically conventional loans will not allow other parts of the deal to be the borrowed funds.

@Boris Slutsky  Unfortunately for conventional financing, which offers the best rates, no part of the downpayment can be borrowed.  That question is on the mortgage application. 

It may be possible with commercial financing, but those rates are much higher and the terms shorter.

@Juan Ruben Cortez  Definitely agree with Chris' comment above.

Adding that as a buyer that's done a number of deals, my first offer would typically be 10-20% down, a market interest rate (6-7%), payments amortized over 30 years, and a 5-7 balloon payment are good starting terms.  Then negotiate from there.  Once you reach an agreement, use a real estate attorney that specializes in SF deals to finalize the paperwork.

Also recommend that you get the property inspected and appraised (the appraisal won't be required by the seller the way a bank does, but you want to make sure you're not over paying).

Finally just do a good check of the property - you want to make sure it's not full of non-paying tenants and the seller is just looking to use SF as a way to unload a bad property onto you.

Good luck!

@Ali Mol  Just curious did you end up pursuing this strategy, or do something else in the end?