All Forum Posts by: Andrew Garcia

@Chuck Payette, I see. That means that the condo is non-warrantable. When you speak to lenders, make sure that you say that the condo is non-warrantable. They will know what it means and will let you know if they have any programs that can help.

Congratulations! Now you just have to refinance to open up funds and then you can move on to flipping. 

Again, congratulations for taking the first steps toward financial freedom through real estate.

Hi @Mo Khidir, there are always options like FSBO.com or craigslist to find off-market properties. However, that might not be in line with your priority.

Hi @Julia Havia, the flood insurance is really the only difference. As long as you disclose that information to any prospective buyers, you should be fine. It might be a little harder to sell since the monthly payment will be a couple hundred dollars higher than similar priced properties that are not in a flood zone. However, it should not be a deal-breaker if you take that into account.

Hi @Chuck Payette, I am not licensed in MN so I cannot help you but I can give you the questions to ask a lender. Is it the HOA docs that won't meet Fannie Mae requirements or is it a non-warrantable condo?

1. Look up "Minnesota Mortgage Brokers". Some direct lenders have these programs but not all.

2. Explain the situation and ask for a Non-QM loan. The rate will be a little higher but you can work with the HOA to make the community available for conventional financing and then you can refinance to lower the rate in 6 months, provided that rates don't increase dramatically.

3. Make sure you shop with 2-3 lenders to ensure you are getting the best deal possible for yourself.

I hope this helps!

Actually, @Edgar Gonzalez since you are a first-time homebuyer you can put 3% down conventional. This could make more sense since you don’t have mortgage insurance for the life of the loan, the monthly payments could be cheaper, and they are easier to get offers accepted in this market. 

I would look into that and ask the lenders that you are shopping with to give you rate quotes on both and give you a side-by-side comparison of the two. 

Hi @Edgar Gonzalez first, welcome to the real estate investing community! I am a mortgage broker so I can help you with this.

There are a few issues with NACA. Specifically for investment properties. The biggest issue is that they require that you live in the property as long as you have a NACA mortgage. So if you ever decide to move out and make it an investment property, you would need to refinance into a conventional, DSCR, net rent, or some other program. By then, rates could be in the 3s or in the 13s. It's a risk that you have to be willing to take. Additionally, they have stricter underwriting guidelines and lower loan limits. If you plan to live in the property until you die and need the assistance, it can be a good program but for your needs, it might not be the one for you.

There are other issues but I wanted to give you some information now. If you want to learn more about the pros and cons or simply compare your lending options, feel free to reach out.

Hi @Ryan Adams, I agree with the others. You will probably be best served connecting with wholesalers. 

The issue that you could run into with them is that you would have to close quickly and it might be hard to get financing. I have a lending partner that can work on assignments of contract and close quickly. Feel free to reach out if you would like some more information.

Hope this helps!

Hi @Alana Reynolds, hello from Maryland! There are a few things that you need to know:

1. Gut renovations are not the same as paint and carpets. Lots of things can and will go wrong. Be conservative in your estimates and be prepared for delays.

2. Do not do a 3-year amortization. That would mean monthly payments of over $3,500 at an 8% interest rate. Do a 30-year amortization with a 3-year balloon payment. Even if the renovation takes a year, you have two years to refinance or sell the property.

3. For financing, you can look into an FHA 203k loan or a Fannie Mae Homestyle loan. There are also Non-QM products available such as Fix and Flip programs. I'm a lender so if you give me some more information, I can give you a better idea of which route is best.

I hope this helps! Please let me know if you have any questions.

Hi @Hadiya Coppedge, it really depends on how much you put down. Some of my lending partners used to lend up to 90% CLTV on HELOCs but they recently pulled back. Lenders are becoming stricter on lending requirements.

I have a few recommendations.

1. Is the home you purchased in March a primary residence? If it is not, you can go FHA with 3.5% down or conventional with 5% down on a duplex to live in one half and rent out the other half (AKA house hacking).

2. You can put 20% down on a new property and have different options (conventional, full-doc, DSCR, etc.)

3. Try to get private money to fund the down payment.

Please let me know if you have any other questions.