Financing eligibility question

[Jeremy Holleb]

Hello everyone. I’m in a bit of a weird situation and wanted to ask for advice. So I recently got laid off from a startup company. The timing was very inconvenient because I was ready to start approaching lenders for financing on a multi family apartment building. I have $230,000 of my own money ready to go but I’m between jobs. Will this impact my ability to get financing? Looking for a friend! Thank you!

[Derek Harris]

Originally posted by @Jeremy Holleb:

Hello everyone. I’m in a bit of a weird situation and wanted to ask for advice. So I recently got laid off from a startup company. The timing was very inconvenient because I was ready to start approaching lenders for financing on a multi family apartment building. I have $230,000 of my own money ready to go but I’m between jobs. Will this impact my ability to get financing? Looking for a friend! Thank you!

Yes. Banks do not like risk and you transitioning to a new job is a red flag. Although anything is possible, I would consider partnering with someone on this deal. 

[Jeremy Holleb]

@Derek Harris I appreciate that. So even though I have $230,000 in available cash, you’re saying they would still be unlikely to approve any loan? Even if the property is cash flowing?

[Derek Harris]

Originally posted by @Jeremy Holleb:

@Derek Harris I appreciate that. So even though I have $230,000 in available cash, you’re saying they would still be unlikely to approve any loan? Even if the property is cash flowing?

Jeremy, keep in mind that I am not a lender, but from my experience, banks do not like risk and they try to do as much as possible to minimize risk. Many lenders want to see two years stability in a job. They want to know that you'll repay that loan. I overlooked that this was for a commercial loan. Whoops! My suggestion is to find a mortgage broker and have them shop around for you. Lenders will want to see your personal financial statement and the financials for the deal. Also, you may want to consider using a local lender.

[Stephanie Medellin]

@Jeremy Holleb  There are a lot of factors that will determine whether you could get a loan without a job.  The biggest one is whether this is an investment property, or whether you will live there?

If it's an investment, do you already own your primary residence?

Price range?

Number of Units?

% Down?

Credit?

When you have a sizeable down payment and good credit, there are numerous loan options for cash flowing rental properties, even when you don't have a job.  

[Jeremy Holleb]

@Stephanie Medellin to answer your question, I have excellent credit, this would be solely an investment property, it has great cash flow with long term tenants, and I have more than enough for a down payment. My only issue being the fact that I’m out of a job for the first time in my life but it should be temporary considering I’m already being recruited by a few companies. I just don’t want to let a good deal fall through because I’m temporarily out of work.

[Stephanie P.]

@Jeremy Holleb

If you have excellent credit and enough cash to pay 25% down plus closing costs, just do a portfolio loan that requires no income verification and call it a day.

Stephanie