All Forum Posts by: David H.

@Chris Mason

Such a great technique! Love it!

@Ralph R.

I have great news to report! Ralph, you strategy worked!

The credit union was able to underwrite the loan with just me on the note.

And, to make a good outcome even better, the rates dropped today and they locked me in at 3.625%!

Thank you for you advice!

@Chris Mackinlay

Unfortunately my girl firmer doesn’t have any accounts that would be benefited by this. She may have one but I’ve had trouble in the past with getting that boost to work.

@Ralph R.

The good news is I’ve owned the other property for four years. The bad news is I have expenses quite a bit so the income does not appear as strong as it could. It’s going to be tight if it works. My day job provides me a good salary, just not sure it’s good enough to support two properties.

In the end this is an eye opening experience and lesson in making sure everyone’s credit scores are tip top.

@Ralph R.

That’s one angle I’m hoping for, the loan officer said she would work with underwriting to see if that would be an option.

I currently have a mortgage on another property in my name but that property has strong rental income.

Fingers are crossed!

Thanks Ralph!

Thanks Stephanie great idea!! I will make sure to propose a rapid rescore tomorrow! There is student loan debt we could pay and have funds to do so. The rate lock has until mid-Feburary. The only concern I have is the closing date being Feb 3rd. Hopefully there is still enough time. 

Thanks Chris!

I definitely do not blame my LO. I am however concerned they had not made us aware of this requirement to pull credit again. I do understand it is out of their hands, but I feel they should have given us a heads up cause they new back in December the close date was Feburary 3rd.

My biggest frustration is if they had just rerun our credit back in December my girlfriend would have been above the 680. But after running for insurance and the other lenders pulls showing up it is now lower.

Sounds like it is what it is though :(

Thanks for the quick and thoughtful comment!!!

Good evening BiggerPockets! I am looking for advice on an issue I am experiencing in the 11th hour with my credit union.

I am purchasing a duplex to be owner occupied with my girlfriend.

- We have a close date of February 3rd.

- Our credit union provided us with a pre-qualification letter on September 19th.

- They provided us with a commitment letter on December 23rd. Here they committed to a rate of 3.75% with 10% down.

- A rate-lock was provided on January 10th locking in the rate of 3.75%

- Today (Janurary 21st) my mortgage lender called to tell me they had to re-run our credit and my girlfriends credit dropped to 679, one point below the minimum acceptable for the product we were offered. As a result they are increasing our rate to 4.25% 12 days from the closing date.

My girlfriends credit dropped due to the credit pulls that have been done in the process of getting this loan. Be it from the insurance company and we did shop the rate at 2 different lenders in early December. The frustrating thing is one of those lenders offered us a lower down payment with a 4.5% rate which I would have happily taken if I knew I would be bait and switched to 10% down with a 4.25% rate. Has anyone had an experience with this? Does anyone have any suggestions on how to resolve this? Do I need to just lay down and take it? 

Thank you!!!

@Chris Teti

This is an interesting strategy that I have seen applied recently as a lender working on an SBA CRE Biz Acquisition deal.

The client used unsecured debt for the down payment. This is typically frowned upon for SBA but is technically permissible as long as the unsecured lines payments can be made through outside income, I.e the spouses salary, investment real estate cash flow, etc.

The big danger with this types of loans is many are on daily payment plans and many front load the interest. Be careful to read what you are actually signing up for when utilizing this strategy. Some come with “judgment of deed” or some crazy clause that accelerates payments and allows the lender to liquidate your bank accounts. Some are great though and are not an issue.

When done correctly it’s fantastic. When done poorly its a great way to lose your shirt.

@Ed Emmons

Would you run a heat pump system without a backup oil or gas system?

Also, have you ever had any issues with pipes freezing the basement due to losing the heat from gas or oil pipes no longer being in use? That’s my other big fear if I switched over. I’m not sure if it’s rational though

Thanks for your advice Ed!