Any 10% mortgage companies or banks out there

Multi-Family and Apartment Investing
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Any 10% mortgage companies or banks out there

Carlos Araujo
New York city, NY · Member since 2016 · 18 posts · 1 vote
Hey guys, I'm looking for a mortgage company so far I looked at going to a big bank like Bank of America and Wells Fargo but what about all these online, any recommendations would help I'm located in New York! I'm looking to buy a 3 family home for 140k but most lenders want 25-30 I don't want to put so much down because I want to have money left over to pay the mortgage for a year just in case of vacancies. I get a lot of people saying I should do an fha loan but I don't want to live there or change my address. If anyone knows good banks or lenders please let me know Thank you guys
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Joel OwensBusiness Member
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Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
9y

You need to either find an owner financed property for the loan with some down OR find a lender that will hold a 75% first and allow  an owner finance  10% to 15% second.

You are not going to get a conventional lender to go 90%ltv on a loan for first position. Owner stops paying mortgage, property falls into disrepair, lender forecloses and property is now worth less than the 90% the lender loaned out on.

That is why you are seeing 25 to 30% down for investor owned property. 

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  • Joel OwensBusiness Member
    Moderator
    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    9y

    You need to either find an owner financed property for the loan with some down OR find a lender that will hold a 75% first and allow  an owner finance  10% to 15% second.

    You are not going to get a conventional lender to go 90%ltv on a loan for first position. Owner stops paying mortgage, property falls into disrepair, lender forecloses and property is now worth less than the 90% the lender loaned out on.

    That is why you are seeing 25 to 30% down for investor owned property. 

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  • Franco Li
    Vendor · New York, NY · Member since 2017 · 217 posts · 88 votes
    9y

    Larger banks (WF, BoA, etc. ) will most likely never provide you anything higher than 80% LTV. They will also take extremely long time to process the mortgage, and leave no room to negotiate. What you may benefit from seeking financing through them is you may save (most likely not) on pricing if you are a customer already - i.e. checking, savings, brokerage acts, etc.

    I think you should look into local lenders and credit unions who will probably be able to provide you 85%+ LTV, although you might need to pay a higher APR. Still, if the numbers check, bc your lower down payment, or initial dollar on investment, you may see even a higher % return! Good luck.

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  • Joel OwensBusiness Member
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    Real Estate Broker · Canton, GA · Member since 2010 · 15k+ posts · 11k+ votes
    9y

    I haven't seen any lenders go 85% on a first. For MF I have seen some 80% ltv but it depends the cap rate you are buying at.

    Even then rate is high for more risk like a 6%.

    If you go less LTV for first and have seller carry the second then you can try and blend the rate down into the 4's possibly between the 2 loans.

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  • Franco Li
    Vendor · New York, NY · Member since 2017 · 217 posts · 88 votes
    9y

    I've worked with a local lender in upstate NY that allowed for 85% LTV! The rate was a point higher than market-going rate, but it was a good experience!

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  • Benjamin Burket
    Realtor · Canandaigua (Rochester area), NY · Member since 2016 · 87 posts · 37 votes
    9y
    Franco Li that's great. Would you mind sharing the name of that lender? Was that for a single or multi family property?
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  • Rick Snow
    Investor · Sacramento, CA · Member since 2015 · 65 posts · 33 votes
    9y

    clarityreturns.com/financing 

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  • Marc C.
    Buy-and-Hold Rental Investor · Santa Fe, NM · Member since 2015 · 438 posts · 352 votes
    9y

    Hmmmm. 90% LTV is a pretty rare find. 10% down often results in insufficient cash flow to make the bank's 1.2 or 1.25 debt service coverage ratio.

    Why not just ask the seller to carry the whole thing? If he or she is retiring, then they should be interested. 

    The other option is to buy a smaller building. 

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