Would being a KP affect your ability to get conventional loans?

[Michael Jiang]

Hi BP, I was wondering if being a KP on a non-recourse Fannie Mae loan affects your ability to get conventional loans for SFH?

[Michael Le]

It should not but it has affected me before due to ignorance from the bank. I was in the middle of closing one of my apartments at the same time I was trying to refinance my house. They asked for my bank statement which included a large dollar transfer and asked me what it was. I stupidly told them it was the earnest money deposit for a commercial deal I'm doing and they asked for more information on it. Long story short they put the $5M Freddie Mac non-recourse loan against my debt-to-income ratio. So obviously I would no longer have enough income even to get a Chevron gas card at that point. In the end I had to go to another lender who wasn't so stupid.