First Lien Strategy - All In One loan is now avail for investment

[Albert Bui]

Great news is that the AIO or all in one loan is now available for investment properties. So for those folks who are interested in utilizing the first lien heloc strategy to speed up the mortgage acceleration process this can be that option if you dont own a primary residence.

Previously the AIO loan, a first lien position line of credit, was only available for primary homes and second homes.

Here are some interesting facets about the product that make it different than HELOC's:

- interest is calculated daily based on the balance that is left over at 12AM

- The AIO loan comes with a checking account that moves over any cash in this account against your loan balance at 12am each day which is where it gets its name as a sweep account. This only occurs if your loan still has a balance otherwise the cash stays in your sweep account

- Interest is charged on the 20th/21st day of the following month meaning all of the interest due for the month of February is added to your loan balance on roughly Mar 20th/21st which allows all your deposits from Feb 1st till mar 19th to continually destroy your mortgage balance. This is the key differentiator because you get the 20 day grace period follow the end of the statement period similar to a grace period for a credit card.

- Can be used for non owner properties 1-4 units, second homes, and primary homes

If anyone has any questions on the strategy or product let me know. 

[Hayden Obrien]

I'm a 3 unit house hacker in the Bronx. AIO first lien HELOC is perfect to eliminate my 440K. Two problems, my DTI is somewhere at 46%. I believe I can get there with the right CPA. (taxes, tenants75%, personal 25%) The banks /underwriters have this strange formula? Firstly, I need to qualify. In addition, are there any good programs covering my area? What are the closing costs associated with the AIO ? I am hoping it's not like the Wild West where each bank have there own rules! Please Explain.