Tightened lender requirements in current COVID situation

[Geetha R.]

Hello fellow investors,

We have been investing single family homes in Charlotte and nearby areas. The lenders we were working with, are currently asking for more than 30% down payment because of their concern over the COVID situation, and they offer only 65% cash-out refi.  We could not go with conventional option because of debt to income ratio, resulting from our multiple real estate investments.
Are you facing the same issue? Is there anyone lending with good terms on non-conventional options ? 

[Daniel Molina]

Hi @Geetha R. What you are seeing can be typical. In the Charlotte market I am see 20-25% down for investors with good experience and buying right, but cash-out across the board has been limited to 60-65% LTV and in some cases the lender will request additional funds held at closing to cover some payments. I would suggest you do a blanket loan and if you have more than 1 rental to access all the equity at once.

I agree with @Eric Johnson you will need to wait until liquidity is restored and some confidence regained, it is my belief the compression stays for a while possible through to the end of the year. While markets are getting better are areas reopen this is a global economic concern not a local one so the correction time will take longer than expected.