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Updated almost 4 years ago,
Best way to get unconventional financing in my situation?
Hello BP community, I am currently a new investor here in Columbus, Ohio and I am looking to house hack a multifamily. I currently have a 33K/year salary. However, this is a 1099 job position. I'm a recent college graduate and was hoping to use my prior 2 years of college experience to fulfill the 2-year work experience requirement.I've talked to a number of conventional lenders and they've told me that because it's a 1099 (not a W2), I absolutely need 2 years of experience.
I talked to my employer about this and they stated that they will be transferring me from a 1099 to a W2 later in the year (but no specific date stated). Because of this, I am now exploring unconventional financing ways to fund my first real estate deal here in Columbus. I have a ton of assets and cash on-hand (well over 6 figures), but I just don't have the "stable" income necessary to get conventional financing. Here are the different options I've thought of:
1) Reach out to Non-QM lenders - I was thinking of reaching out to non-QM lenders and working out a deal with them where they can collateralize my assets (cryptocurrency, cash, or etc) OR they can offer me a DSCR program. I was told that non-QM lenders mostly provide loans over 500k and right now because of the pandemic, non QM loans are nearly impossible to find? Not sure how accurate this is!
2) Reach out to portfolio lenders/local CUs - I was thinking about reaching out portfolio lenders and local CUs to see if I can work out a deal to collateralize my assets or if I can hold my cash in their bank or something... would this work?
3) Finding a partnership with someone who has a W2 position - The thing is, I have more than enough cash to do 20% down and it feels like I would be getting into a partnership just for a W2 status, which doesn't seem like a very good tradeoff to share everything 50/50 (especially when my employer will be transitioning me to a W2 later in the year). Of course, if the person had a lot to offer, I would be super open to partnering.
4) Use seller financing?? - but then again, it seems like deals with seller financing are very rare to come by so I don't know how useful it would be.
5) Wait until my employer changes my 1099 to a W2 later in the year (again, no specific date as of yet)
I'd love to get your guys input on my situation and what route I should go with. Please let me know which choice has the most likely probability of working out and the one that would be most worth my time! If I'm forgetting something, please let me know.
If you're in the columbus area and can refer a good lender that can help with my situation, that would be awesome too.
- Jimmy Lieu
- [email protected]
- 614-300-7535