All Forum Posts by: Chris Teti

Hi Jennifer, I think those issues are more related to residential mortgages. HML's can do fix and flip loans, but also long term rental loans. It would be good for you to connect with a HML DSCR lender that will only lend under the business name based on rental income, not your personal income.

Hey Todd. I would call another lender and discuss these different options with them. I don't know if it's different in NY, but there shouldn't be any reason you can't use a gift as a down payment and they can run some #'s on what the rates would look like with just you or with you and her included. Good luck! 

I agree with Slade. Borrow from banks.

Hey Justin, just some advice. Anytime you do business with family or friends, go into it just like you would any other business partner. Have an agreement or contract drawn up outline terms, responsibilities, etc. Make sure you are all clear on expectations, decisions, and what happens if the project loses money.

For this deal specifically, if it's just a one off with this family member, it might be cleaner to let them keep their $10K and just throw them a finders fee.

Usually a concession allows you to roll some of the closing costs into the mortgage. 

Hi Alana. HELOC's are great tools. Just be careful that if it's on a property in your name (like your home), it will report to your personal credit. Not an issue having it, but once you start to use it, it will impact your DTI.

Since the HELOC will be on your primary residence (in your personal name), and if your lender for your investment property will be with a residential lender (in your personal name), they won't let you use the HELOC for your down payment and closing costs. They want to make sure you have the cash available for this and they would be able to see the funds came from the HELOC, not to mention the impact to your DTI.

If you work with a HML for your investment property they typically don't care where the gap funding comes from so you may be able to do it.

It depends on where the property is held by your friend/family member. Assuming it is a home in their personal name, the HELOC will report to their personal credit report. Once the balance starts going up, that will show up on their credit report too and will impact their DTI. If you miss a payment, the late payment will show up on their credit report.

For you, if they write you out a check and you deposit into your bank account, it's just cash to you to use however you want.

I can't tell you about the tax implications, but if you are planning on using it as down payment for a property and are planning on using a residential mortgage company, it may be ok as a gift, or just let it season in your bank account for a few months. If you are working with a HML, it shouldn't matter in most cases where the $$ comes from as long as you have access to it.

I've never worked with them specifically, but typically companies like that aren't the end lenders, they are getting you loans or lines of credit from a bank. So if you default on the loan/LOC, the bank will send you to collections. Unless they are non-PG vendor tradelines.

I think you want to do a wire transfer. Make sure you call the title company to get wire transfer instructions (NEVER GO OFF OF AN EMAIL). Then you'll want to upload your AOS into plastiq.