Anybody buy several SFR's simultaneously? Funding is too slow!

[Ben Phillips]

Hi Everyone, 

I am a buy and hold investor looking to purchase a few SFH's. Assuming you have enough money to buy several SFR's at the same time and you are trying to get 20% down conventional financing, are there ANY options to get multiple deals done at the same time? Considering you had enough money to fund 5 homes in your market, what is the quickest way to get these done using conventional financing? It is taking me forever, having to buy one at a time. It is not meeting my personal timeline goals. At this pace I can only close on about 2 per year. You know how it goes... The hunt takes a long time then all the inspections and underwriting takes the rest. Meanwhile my cash is sitting unused but I want to deploy it all if I can. However, when you're getting a loan, they make you sign a sheet that says while underwriting is underway you will NOT be involved in any other deals or making other offers anywhere. Really gets on my nerves. Has anyone found a way around this besides a commercial loan? 

[Chris Mason]

Hi @Ben Phillips,

Yup, you can close multiple escrows concurrently. Note that "concurrently" in this case means at the exact same time. So if you have 4 in contract, all 4 close at whatever time the slowest of the 4 would close by itself. Realistically, this can mean that you write offers with 60 day closes, get 2 tied up in contract, then over the course of the next month get two more tied up in contract with 30 day closes.  Maybe a fifth one pops up with 3 weeks to go, but the lender already has all of your paperwork, so that one can be a 21 day close. In that simplified example, all would close 'on time' relative to the relevant individual contracts.

Alternatively, you can purchase using hard money and then when there will be a break in the purchasing, do a batch refinance with concurrent closings. 

What you cannot do, unfortunately, is have staggered closings. Meaning that you have 3 escrows open at once, and they close a week or two weeks apart each. That's a no-no. Each time the LO, underwriter, and underwriting manager, get a ping saying "$400k in new debt appearing on credit report! Danger, Will Robinson!" -- that's an underwriting reset. Will screw your timing 3 ways from Sunday. Stack that with a last-minute trip to South Korea to visit family, and now your LO has an anecdote to share about what NOT to do that involves you running around Seoul at 4 am local time trying to find a copy shop that is open. So you disclose them all to underwriting, and close concurrently, with the same lender, same underwriter, same funder, etc, so that the relevant parties all have their eyes on the Big Picture of what you are doing, and of course the firm must allow this which not all do. 

Those are the big bullet points, and there are other caveats, but yes you can be in escrow for multiple properties at once, using Agency fannie/freddie financing. Many lenders have overlays prohibiting "rapid acquisition," but fannie/freddie themselves have no such prohibitions.