All Forum Posts by: David A Lisowski

@Chris Reichenbach

Count HOA fees in the expenses covered by rent. Don't rely on the Tenant paying them directly because failure to pay can result in liens (in some instances), or fines/penalties. These things will also cause complications if you need to sell as title will find out about liens on the title search or owed dues/fines/fees on the estoppel letter.

As others have mentioned, the annual dues shouldn't fluctuate much, plus you should be a member of the HOA and have some say in the HOA budget.

Now special assessments are different circumstances, and probably not something you could ever get a tenant to cover (and probably won't be able to predict much to change a lease ahead of time). That's probably just going to be a cost of owning. You could recoup it with increased rent on the next lease/new tenant.

@Charles Clark

Although each state is different, you can search for "XXX County appraiser website" or "XXX County RE taxes"

Some will let you search by owner, or address or parcel number.

You can also look for county GIS, and usually pull information from there or even link directly to other websites like the tax bill or warranty deed.

You can also usually find a tax calculator which can be useful for estimating taxes on an "improved" lot that may have previous been unimproved (i.e. 2021 tax bill was for a lot so it's like $800, but the improved lot is a $900,000 home so you know the tax bill will be higher - now you can get the number before waiting for the new bill).

For example, here's Dallas County TX:

https://www.dallasact.com/act_webdev/dallas/searchbyproperty.jsp

Typically, you can't borrow money to qualify for a loan

@Elizabeth Calleja

Sorry, but this is a garbage post

Equity is only an asset if you can tap into it.

It doesn't generate cash-flow.

For example, my long term rental currently has a boatload of equity, but the lease rent is the same as 6 months ago. My equity has probably doubled but my cash-flow is the same. It'll stay the same until the current tenant leaves, and a new one signs a lease with increased rent.

Our previous STR (which is currently our Primary), also has a boatload of equity, only some of which we have access to via a HELOC which we used to buy the investment LTR. Since this is currently our primary home, the cash-flow is $0 (you could argue its negative). However, when we vacate and return this to the cash-flow market as a STR, my estimate is that we will have superior cash-flow to our LTR.

Can we hit $10,000 per month between the two? Probably not. The STR would need one hell of a year.

Do we have more than $1.5M in equity? Probably not, but we are closer to that than we are hitting $10k cash-flow per month.

Quote from @Stephanie P.:

Quote from @Eliott Elias:

It's getting kind of crazy. I was charged $8k on a 112k DSCR refi.

If the broker charges 2 points. That would be $2240. They may charge a processing fee of $450 (that's low, but...).  The lender will charge anywhere from $999 and a point to $1995 at par for underwriting depending on the lender.  Which lender usually depends on your particular circumstance.  Using the more expensive option, you're at $4809 in lender/broker charges.  If your taxes are $2500 per year and insurance is $1500, that's another $4000 for escrows before the title company and prepaids, so I can see $8,000 on a $112,000 loan.

On a conventional loan, you may not pay points because they're built into the lender paid comp, but your underwriting fee will be around $1250.  Add that to the $4000 in taxes and insurance and then title charges and you may be close to $8000.

Closing costs aren't that much more now than they were 3 years ago; in some cases, they're less.

This is a good explanation; I was just posing the leading quesitons.
Cash-to-close and closing costs are not the same. Lender closing items are not the same as title closing items.

You can shop lenders, and you can shop title companies (unless it's stipulated in the purchase contract that seller picks title company).

@William Hinsche

Closing costs? Like transfer and deed tax and lender title insurance?

Or they have 8٪ lender charge?

Or is that the broker compensation?

What section of the Closing Disclosure are these fees under?

@Juan David Maldonado

The other replies are great also.

I break it down to CIA. Credit, Income, and Assets.

Credit includes your debts (but may not cover every debt such as alimony or REO expenses like HOA dues) so I like how the others have specifically mentioned debt since those debts will be included in the loan application.

My first boss in the mortgage world would always say, "95% of loan problems come from the miscalculation of income." And to a large extent, that's true.

If you are W2, it's relatively easy to get your income.

After that, you can check your credit for free and determine the monthly debts.

After that, it's a simple debt-to-income ratio.

Most people can pre-qualify themselves (but I understand why a vast majority of people don't or don't know how). You can also use this information to max-out/set limits on expenses/financing etc. when looking to purchase. Or work backwards to determine the loan terms you want before you even apply.

@Rob Carmody

Why do you want to do both?

Just for more commission?

You mentioned friends and family... are you being an Agent/MLO for their advantage? If so, then why would more commission matter?

You might consider picking one route and getting really good at that. The "extra" commission for doing both roles would be insignificant if you just focused on one role and generated more business.

Be an agent with good relationships with lenders or be a good MLO with good relationships with agents.

@Derek Young

@Joshua Massari

I work for a mortgage company, and I would also like to know who is lending 80% HELOCs on investment properties?

I'd love to tap the equity in our investment property so this isn't necessarily a work-related query. More a personal investment query.

We get HELOCs on our primary residence relatively easily, and will continue to do so. But I'd prefer HELOCs on the investments rather than cash-out refis.