Skip to content
×
Try PRO Free Today!
BiggerPockets Pro offers you a comprehensive suite of tools and resources
Market and Deal Finder Tools
Deal Analysis Calculators
Property Management Software
Exclusive discounts to Home Depot, RentRedi, and more
$0
7 days free
$828/yr or $69/mo when billed monthly.
$390/yr or $32.5/mo when billed annually.
7 days free. Cancel anytime.
Already a Pro Member? Sign in here

Join Over 3 Million Real Estate Investors

Create a free BiggerPockets account to comment, participate, and connect with over 3 million real estate investors.
Use your real name
By signing up, you indicate that you agree to the BiggerPockets Terms & Conditions.
The community here is like my own little personal real estate army that I can depend upon to help me through ANY problems I come across.
Private Lending & Conventional Mortgage Advice
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

Updated over 8 years ago on . Most recent reply

User Stats

512
Posts
290
Votes
Will Pritchett
  • Rental Property Investor
  • San Antonio, TX
290
Votes |
512
Posts

First BRRRR loan falling apart

Will Pritchett
  • Rental Property Investor
  • San Antonio, TX
Posted

So our first BRRRR property was moving along great. We paid cash and renovated and received a great appraisal. Lender said my retirement account would count as reserves (since we would spend most of our liquid cash on the project). Now that we are going through underwriting they say they can't use these funds.

     I was surprised  they would count them originally but they checked with an underwriter and the underwriter said yes. 

     Now my best deal yet may turn into an unintentional flip. I really want to refinance the property and keep it. The irony is that the moment after closing I would have double the required funds. I knew they wouldn't count them as reserves but asked anyway. I was right. 

     I am asking for some brainstorming ideas from this community to help me save the deal and free up my cash. I am probably short about 14k on reserves required. I don't think they will allow gifted money for reserves. I don't think they will allow borrowed money either. I am now looking for portfolio lenders in San Antonio or other options. Please let me know what you think if you have any ideas. 

     My preferred exit strategy is to refinance it and keep it for a rental. A distant second concern is if I have any recourse for being misinformed by the lender. I based my strategy on what seems to be misinformation. 

     Thanks in advance for any ideas you may have to help me resolve this dilemma. 

-Will

Most Popular Reply

User Stats

1,209
Posts
851
Votes
Ralph R.
  • Investor
  • Bethel, AK
851
Votes |
1,209
Posts
Ralph R.
  • Investor
  • Bethel, AK
Replied

Will Pritchett Will if it's something you really want to do get a commercial loan. The down payment is a little higher and the interest is a bit more but they will lend to an LLC and don't care how many loans you have. There will be a balloon and refi down the road a few years. Mine have a 25 year amortization. These loans are based more on the performance of the property than your personal finances.

Loading replies...