All Forum Posts by: Timothy Maloney

 You will have a difficult (not impossible) time getting 2nds/Mezz debt on such small value homes.    You could also refinance the entire portfolio and cash out up to 80% of the appraised value (depending on your credit).    I wish you luck and continued success!   

Michelle,

@Michelle B. 90% of purchase plus 90% or more of the rehab is available to you in Cinci (from me or many other sources).    If you want to make a sizable down payment and pay the rehab you'll get a better rate.    However, I recommend to my borrowers to take the 90% financing at 9.99% and keep liquidity for an opportunity that may pop up - this way you'll never have to wholesale again!  

It is on MLS? When you make your offer you can elect a financing clause. The seller may ask for a cash only offer (where you lose earnest monies in the event you are unable to close). We work with house flippers all the time to "pre-approve" them BEFORE they make an offer so they are not putting their cash at risk.

You may have 800 FICO and a great resume but a lender may decline the PROPERTY if the numbers don't work.  

Most lenders, myself included, can run any scenario for you in just minutes to see if it will work (and what it will cost you).    San Diego, CA has some of the greatest FNF financing in the world so you should have no trouble finding a reputable source for 90%+ financing.

Good Luck!

It is illegal in many states (New York where I lend it is against the law).   Avoid anyone who charges a fee other than an appraisal.    

Some loans will ask for a "due diligence fee" after you've received a term sheet.   This is allowable but still be cautious that your lender is actually a lender and not a scam artist.

Good luck Shah!

The elusive LOC for flippers is a request we see daily. Yes, a 750 FICO is a great start but for any real sizable LOC he'll need a solif PFS (personal financial statement), resume, and proven track record.

It is possible to get a 1MM LOC for flipping at a very good rate but that would require a significant net worth and track record in flipping.

Your local credit union will probably be in the 50k range with the assumptions you've provided.    

Yes, money from that LOC can be used with our Fix N Flip Loans. The down payments are so small (under 10% of total purchase + rehab) that a 50K LOC could be leveraged to flip 500,000 ish in homes.

Good luck!

They vary as widely as do commercial properties. To get a rate in the 4's you need an 800 FICO and a property that debt services flawlessly with national AAA tenants. The rate is determined by a combination of your personal credit, the property, the rent roll, and the LTV. Sorry - I know not a very specific example.

Michael,

25% is pretty standard unless you have 800ish FICO and a solid personal financial statement then you might find 15-20%.    The only 10% down deals we do are for short term bridges/fix n flips and generally have a 13 month term and sky high rates (9-12%).    Good luck on your first purchase!

Hi Simon, Quick question... Why take on a partner with high LTV fix n flip loans out there? I'm truly curious as I talk with flippers all day everyday. I would think that financing 90% of the purchase plus 90% of the rehab costs would be FAR better (even at 11% interest) than splitting 50/50.

I'm very interest in your honest opinion.   

Thanks and good luck!

@Matthew Olszak  Options for Non owner occupied:   

Option 1. 15-25 year fixed loan - 60% LTV, 3-4 points, and a rate in the 8s (for an empty (but not bad) credit report. Take 45-60 days to close.

Option 2 - Bridge loan while she builds credit - 8-12% interest only payments for 18 months - 3 points and likely the same 60% LTV. Takes 15-20 business days to close.

If this is her primary residence then neither option I listed would apply.

Thanks!

@Benjamin EcclesI once had 11 properties and spent 2 hours a week at them.   Of course, when things go wrong, you can spend 10 hours a day.    Others will know better than I but I'd consider avoiding the property manager at first - They are expensive and rarely do a better job that a caring/motivated owner.   Good luck!