All Forum Posts by: Brittany Minocchi

The property with the 2.5% rate is an investment and you’re looking to buy a primary? You mentioned needing a larger home - are you currently renting or do you own a primary now? Just making sure I’m following. 

With that low of a rate, I'd looking into a HELOC or a HELOAN before cash our refinance or considering selling. These products can sometimes be more tricky to find on investment properties than on owner occupied properties, but they exist. Viable options will depend on your credit, property type, whether or not the property is in an LLC, etc…you should be able to pull 70-75% of that equity without any affect to your primary mortgage.

Let me know if you’d like to discuss further, always happy to chat. 

Quote from @Nimit Gupta:

Hello,

I am a first time home buyer and I'll be purchasing my 1st house (primary residence) in the next 2-3 months. 

Value- around $400K

Down payment- $25K

Loan amount- $375000

Questions

1) Since I am paying only 6.25% down payment, how soon will I be able to do a cash out refinance?

2) My objective is to buy my 1st investment property as soon as possible after buying the primary residence. What will be the best plan of action for this?

Thank you for taking time to read this query. Looking for some good advice.

How soon you can do a cash out refinance depends on how quickly you build equity in the property. Will it be forced equity through updates or appreciation over time? How much equity will you want to pull out? Will you be okay with forgoing whatever rate you have when you purchase for a potentially higher rate with a refi? 

As far as buying the investment property, will you be using a conventional loan or something like a DSCR loan? One factors in DTI, the other doesn’t. Are you waiting to be able to refinance before you buy an investment property? If not, how will you get the funds to cover that purchase? It’s not so much that there’s a certain period of time that has to pass, but whether or not your income (or the property you’re purchasing) supports the additional debt. 

Happy to chat if you’d like to connect, good luck on your journey! 

Hey @Alex Tsang!

Are you talking about getting a HELOC on a primary residence to finance an investment property, or getting a HELOC on an existing investment property to access the equity? In either case, I'm happy to chat!

If you're looking to pull equity out of your property without losing your current interest rate, a HELOC can help you reach that goal.

-Funds in as little as 5 days 

-Single-family properties only (condos and PUDs OK)

-Minimum loan amount $25,000

-Full draw required at closing; NO prepayment penalty

-NO in-person appraisal

-Up to 85% CLTV

Restrictions apply. Not available in all states. 5 business day funding timeline assumes closing the loan with our remote online notary. Funding timelines may take longer for loan secured by properties located in counties that do not permit recording of e-signatures or that otherwise require in-person closing. Approval is contingent upon a full application and is not guaranteed. Investor will not extend credit if we cannot verify that your credit profile, debt, income, identity, property value, home equity, and title meet their underwriting criteria.

Hey @Divya Kohli!

Welcome to BP. Your price point of $100-$150k is definitely attainable here in Ohio. The larger cities here are popular for investing, I myself focus on multifamily properties local to me in Canton (about 45 minutes south of Cleveland). The cash flow has been great, and it's pretty easy to find a property around that $100k price point if you're okay with a C neighborhood and/or some rehab. 

Depending on what type of financing you're planning on utilizing, be aware that the non-traditional investment loans that use the income of the property to qualify you instead of employment/income info typically have a $75k loan minimum. Happy to chat if you need anything! 

Hi @Sami Ibn Jamil!

If you’re open to house hacking, that’s a viable option. You could live in one unit of a multifamily property and rent the others out, using that rental income to offset your mortgage payment. 

As far as a down payment, you could do at little as 3.5% with a house hack, 15% for a single family investment property or 25% for a multifamily property you don’t intend to occupy. 

Your budget is something you’ll have to crunch some numbers to figure out….none of us know how your income and debts break down. You may be able to use gift funds depending on the lender and loan program. 

There are many locations that could be viable options depending on whether you decide on LTR or STR. Where I am in the Midwest, long term rentals are popular and the cost of entry isn't terrible. Feel free to reach out if there's anything I can help with!

Yep, FHA is only for owner-occupied properties with 1-4 units.

@So Da@So Da

HELOCs are tough to find on investment properties (especially if they're in an LLC). You could do a cash out refi with a DSCR loan, then the LLC would not be a problem. A closed end HELOAN would also be an option if you don't want to mess with your current interest rate - I know of at least one that allows investment properties in an LLC, up to 4 units I believe, and doesn't have a prepayment penalty. Happy to discuss further if you'd like to connect.

Hey @Angela Romero!

I'm in OH, but my team can assist in FL. Happy to chat - and can promise you'll have no problem getting connected to an actual person!

It depends….how quickly do you think you can pay back the HELOC? Will you cash flow more than $500 if you sell that property to invest in others? Are you doing a 1031 exchange and if so, will you be able to find the properties to purchase in time?