All Forum Posts by: Zack Karp

@Simone Douglas no you would just do a cash out refi Conventional loan once you're done with the rehab.  Assuming there's equity now for you to pull out.  Since this is a 2-unit property, if it's still your primary residence, your max loan amount for a cash out refi is 75% of the new value.  If you aren't going to be living there, and moving on to the next house hack, then if you refi as an investment property the max loan amount is 70% of the value.

Hopefully you ran your numbers with this exit strategy in mind.  If you didn't, you're working with the wrong LO and realtor.  You should always have the exit lined up before you enter into a deal.

Best of luck!

@Simone Douglas refi to Conventional, no brainer. If you are planning on using FHA again for another property, then you need to refi out of FHA, because you can only have 1 FHA loan at a time (unless you relocate 100 miles away). So you would need to free up your FHA eligibility. And don't do a heloc first, or you will ruin any chance of refinancing. Only do a heloc AFTER you refi to Conventional first, if you can find anyone to go over 80% LTV on a 2-unit.

Best of luck!

@Adonis Yancey this is an impossible question to answer without knowing more information. Both Conventional and FHA have their place as the better option. It depends on your credit score, the property type, your income, down payment, and future plans if you want to buy more properties.

Get with an investor-friendly loan officer to map out your plan and strategy.  The right ones will help guide you on this path, looking out for your best interests.

Best of luck!

@Weng L. no it's not a sub-category, it is completely different.  With Fannie/Freddie, every lender has to follow their guidelines (and can impose harsher restrictions if they want, but not looser).  With jumbo, any lender can make their own guidelines and do whatever they want.

@Weng L. it is a Fannie/Freddie/Jumbo/FHA/VA guideline for ANY primary residence mortgage, that the buyer must occupy the property within 60 days of closing. This does not vary from lender to lender. So if you want to be able to sell the property to a buyer using a primary residence mortgage, then you should not have a lease ending that far out. Obviously this wouldn't matter with a cash buyer.

Hope that helps and best of luck!

@Joseph Mallon

My cash out will be used for investment purposes.

The End.

@Jerome Morelos short answer, yes you can.

Are we talking about a 1-unit property, or a 2-4 unit?

Conventional max LTV's: 1-unit 95%, 2-unit 85%, 3-4 unit 80%.

So if this is a 3-4 unit, you would need to be at 80% LTV and there wouldn't be PMI.

Also if your income is below the income cap for the program, Conventional Home Possible is coming back on 11/15, which allows up to 95% LTV for a 2-4 unit.

Check with your loan officer on your options.

Hope that helps, best of luck!

@Tayo O. it's based on an automated underwriting approval.  The middle credit score can usually be as low as 660 for an investment property rate/term refi, depending on your debt-to-income ratio, reserves, and other factors.

@Tayo O. yes you can do them both simultaneously...refi the existing property to Conventional investment, and do a a FHA primary purchase...at the same time.

Well, yes, you have to be able to qualify for both loans :)

@Tayo O. why can't you refinance as an investment property? The rates are still stupid low. Take advantage now before they go up later on. Then use FHA again for the next property. No brainer IMO. Feel free to reach out if you need any help.

Best of luck!