All Forum Posts by: Tom S.

@Chinita Webb  Hi Chinita - correct, I was able to negotiate the "48 month lock out" - which is basically a pre-pay penalty, to 24 months.  Although reading the posts, I saw others have negotiated it to 0 months (no pre-pay penalty all all).  I haven't tried to pay anything extra on the loan.

I'm at just over 24 months now and just making the monthly payments, no issues at all since it funded.

As mentioned in my posts, companies like SoFi have no fees or pre-pay at all on their personal loans, but they hit your credit while this loan does not.  

@James Bartlett  James - just curious, what happened with this potential deal?

@Martin Guerrero Nothing wrong with using HELOC for the down on investments properties, just remember the current trend is higher rates, so your payments will increase of course.

Are you sure on those rates? 1.5%? I just got a quote on a HELOC a few days ago, and it's prime + 0%, so 7.5% regardless of the amount I take out. The loan amount will be determined by the appraisal, and I'm only charged on the amount I draw.

@Jack Shuttleworth  I'd fine tune the value of it too.  If it's been on the market for sometime at $180k and not selling, it's not worth $190k.  You gave a range of $180k to $199k, does that mean they listed it at $199k, reduced to $180k and it still didn't sell?  Consider getting it appraised.

@Reese Mondina Just adding, for an apartment complex it wouldn't be a conventional loan you're seeking, it would be commercial (assuming 5 units+ already).  Agree with the above posts, see what it will take to purchase it first, get estimates to expand it, then look for additional financing to expand it. 

Ask around to local banks in your area and speak to the commercial financing department to get their requirements. Remember commercial loans are generally shorter term (mine are 20 year) which means a higher monthly payments. Insurance is also substantially higher than SFH, so factor all that in.

Good luck!

@Daniel Vineis  Look at unsecured personal loans as an option.  Quite a few lenders like SoFi, Discover, etc offer loans in that $$ range.  No fees / points, no pre-pay.  I did one about 2 years ago, 2-3 days from application to funds in my account.  12% rate for me.

@Forrest H.I know this doesn't directly answer your question, but I closed on two conventional loans in early 2022 when the rates were still very low.  The lenders have been very picky and following up with random questions, like new debt taken on after the close. I assume this is because they can do soft pulls to monitor my credit.  

So I would be very concerned about transferring title without their permission.  My 2 cents at least.

@Logan Lehmkuhl  Be sure to check that ultimately the seller can do this - still have the loan in her name.  The seller's attorney is saying she has to sell the house (can't have the loan in her name anymore, for whatever reason).  So in addition to making sure this is a deal for you, make sure the seller's attorney will  allow it.  If not, you could be wasting your time.

@Lisa Sluss  Have you looked into personal loans at all for the cash to finish rehab?  I've used both SoFi and Discover loans in the past, both offered up to $50k.  I personally went with Discover, quick application and approval and funds in my bank account within about 2 business days!  No fees or pre-pay penalties at all, only downside was the rate at about 12%.  But if you finish quickly, you won't pay too much in interest.  So just posting my personal experience in a situation like yours.

Good luck!

@Robert P.  As others mentioned above, I work a lot with local banks that know the area and often the property.  You can also get referrals from the RE agent on their "go to" lender.

Keep in mind as you expand to multi-family, up to 4 units is residential financing and 5+ is commercial. So be sure to speak to the commercial lending department if you're pursuing the bigger units.

Good luck!