Not making financial sense

[Hugh Thompson]

So I have spoken to a few "investor friendly" lenders for the past few weeks. Rates for Non-QMs, Hard Money, DSCR loans etc...are ranging from high 9s to just below 12%. That is with fairly good credit and at least 75% (maybe 80% ltv). 5+ units and LTV is even lower. I'm scratching my head trying to understand how that makes sense on a property where the CAP rate be 4,5 or even 6%. Here in SE Florida.....a cap rate of 7%+ is non-existent. The only possible upside (in this area) is equity appreciation and that may not be enough to pull the trigger these days with loan rates where they are. Of course rates are lower when obtaining a fully qualifying documented loan, but of course after a few of those Non-QM is only option.....................