All Forum Posts by: Brittany Minocchi

It'll depend on things like loan amount, credit score, LTV, property type….

The lowest down payment would be with a house hack, where you live in a unit and rent out the others (or rent out rooms). You can use an FHA loan and put 3.5% down in that instance because it's owner occupied. On an investment property with traditional financing, the least you can get away with is 15% assuming it's a single family. Multifamily you'll be looking at 25%. There are also DSCR loans where your income/employment/DTI is not factored in, but you're instead qualified based on the property's income, your FICO and reserves. Some lenders require investor experience on those loans. I'd continue to save - that $10k is likely going to be eaten up just with closing costs alone.

8% from a hard money lender on a cash out refi isn't bad, and 75% LTV is pretty typical. As far as your CU, are they suggesting you apply as though you'll be living in it while knowing you intend to rent all the units out? Or are you planning on living in one? If you're living in a unit, DSCR isn't an option - A DSCR loan doesn't permit owner occupancy (and many require that you prove you own a primary residence), and an FHA loan is only for owner occupied properties. Can't use it on an investment property unless you occupy a unit in a multifamily. 

If you're refinancing with a conventional loan, it'll be like applying for a loan all over again. Income, employment, bank statements - all that stuff will be needed. If you refinance into something like a DSCR loan, your income/employment/DTI are not considered. Instead, we use the income of the property to qualify you, along with factors like FICO, down payment, level of experience and reserves. There are different requirements with different lenders.

Like the others mentioned, not all lenders will look at income from STR and the ones that do typically require at least a 12 month history and/or allow for a lower max LTV. It's more likely that market rents as if it were a LTR will be considered. To answer your question though, you can definitely use DSCR to cash out refi without income/employment/DTI being factors.

There are DSCR lenders that still require 6 months seasoning and some that will allow shorter periods, but you're typically limited to a % of pp in that instance instead of appraised value/ARV. If you aren't looking to pull any more than what you have in it, that might work for you. If you're doing rehab on a property and want to use the new value, your options will be more limited. There are lenders out there that will use appraised value with no seasoning, but rate and fees tend to be a bit higher.

Lots of DSCR lenders available depending on the property and what the borrower is trying to accomplish. Happy to discuss if you'd like to reach out!

Haven't used them, but so far I only know of one lender that goes down to $50k in some instances. Most are $75k-$100k+

Hi Elliot, many lenders do DSCR loans in your area. Happy to discuss further.

I believe as a Pro member you can post things like that in the classifieds section of BP.