All Forum Posts by: Dennis Muno

You can't have two FHA loans at the same time(FHA guidelines) unless they are 100 miles apart. Perhaps a conventional or DSCR loan will be the way for you to go to buy the 2-4 unit property you want to buy

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Newark, New Jersey

Quote from @Alex Baur:

Hi there, I am new to real estate investing and am looking to purchase my first home. I recently graduated from college, and thus I do not have anywhere near 2 years of income history. However, my girlfriend of five years and myself both currently have stable incomes and are looking to move in together. Would it be possible to get a DSCR loan if I use my girlfriend as a lessee, then split the payment down the middle between us? I am aware that DSCR mortgages are generally reserved for rental properties rather than owner-occupied, but would a lender be willing to make an exception given my situation?

Thanks!

Hello Alex,

This is doable. For DSCR loans a lot is not asked for: normally, your credit(660+ gets you good terms and increases chances of financing) and purchase contract, minimum 1 DSCR ratio, as well as enough in your bank account to show for downpayment(usually 20%), closing costs and 6 months PITI reserves(principal& interest, insurance and taxes) will help seal the deal.

Personal income is not looked at for DSCR loans. If both you and your girlfriend have decent FICOs, enough resources for the downpayment(20% down), closing costs and 6 months PITIA reserves you just may have your first DSCR loan to buy a rental property.

0 Votes

Atlanta, Georgia

Buy your properties under an LLC. You credit will be checked when you apply(mostly) but your rental properties will be closed under the LLC, not your name, leaving them off your credit

1 Vote

Always go to nmlsconsumeraccess.org to find out any lender/loan officers credentials. By law, every one must be licensed by the NMLS to operate so their information will be there. Always

1 Vote

Denver, Colorado

Quote from @Sly H.:

I have equity in a commercial office building I purchased in Louisiana. Where can I go to get a cashout refinance? or is there a way to receive a second mortgage on the commercial property

Thanks

Hello Sly,

A local credit union or bank is an option. You could also contact a local mortgage broker to shop multiple banks/lenders for pricing and options for you.

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Quote from @Maxine Dean:

I bought a mixed use property exactly a year ago.

2 residential apartments plus a retail front.

I have about a hundred and forty thousand dollars worth of renovations done and have a tenant in one apartment and will be opening a hair salon in the commercial space.

I am seeking advice on whether or not it is too early to try to get a Heloc in order to recover some of my money .

I have run out of cash to complete some remaining required repairs.

This is my first property so I am a bit lost here.

Just some numbers for context:

Property is a mixed use Triplex .

Price was $649k

Renovations so far $140k

Mortgage Bal $587k

Any mortgage Experts Here please?(HELOC)

Hello Maxine,

So do you have three properties? 2 residential apartments each + retail building?

If you have run out of cash, a HELOC could be a way to proceed. Keep in mind, it isn't always easy to get a HELOC on a rental especially depending on the state the property is in. Also for a HELOC on the first property you talked about, what is the value of the property? That will give an idea of how much in HELOC, if you qualify you have. How much is the equity in the property?

If the price is the same as the value of the property vs your mortgage balance of $587K you may have issues getting a HELOC. If the value of your property is much more then you may have some success.

So the biggest question is what is the value of the property you want to take equity out of? HELOCs depending on lenders have a maximum combined loan to value(CLTV), usually up to 75% CLTV

0 Votes

Philadelphia, Pennsylvania

Quote from @Gaetano Citera:

@Jay Hurst @Dennis Muno @Erik Estrada

A few questions about DSCR loans

Generally, What is the minimum DSCR to qualify?

Can I refinance at a later date?

Is there an early payoff penalty?

So for DSCR loans, usually a DSCR ratio of 1 and above improves your chances of qualifying for a DSCR loan. From 1.2 DSCR ratio, usually the rates get better. However, some lenders go below a 1 DSCR down to a 0.75 DSCR. However, your rate options will be quite high for a DSCR loan with a DSCR ratio below 1. It is possible to get a no-prepayment penalty DSCR penalty however, DSCR loans price better usually starting at a 3 year prepayment penalty.

Yes you can always refinance usually depending on seasoning period and lender guidelines

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If you are buying a multifamily property as-is without any repairs, DSCR loans are a very easy way to go. Generally, a credit pull, and then if the rental income will be enough to cover for the PITI(principal & interest, taxes and insurance) are generally what are used to qualify for a DSCR.

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Quote from @Rich Hupper:

Quote from @Dennis Muno:

Quote from @Rich Hupper:

I have two properties, one a commercial building for auto repair, the other is a mixed use building, commercial retail on the bottom floor and 2 residential units above ( this building is currently out of service needs full reno). Both properties mortgage free

I approached a bank for a line of credit on the auto repair building and a construction loan for the mixed use building.

The bank told me their desktop underwriting flagged my mixed use building as a hazardous space but not the auto repair building. So now the bank is requiring me to do a 21e on the mixed use building but not the auto repair building.

This is beyond me because I would think the auto repair business is more of an issue environmentally. However they are telling me because there was a dry cleaner business at the mixed use building in the past there could be soil contamination.

With that, I am considering not getting the construction loan and putting the building back in service with private money. Then approaching perm loan lenders after completion. Will perm loan lenders look for a 21e?

Hello Rich,

So it turns out the 21e is a state required lender. So I'm guessing most lenders will require this. Check with every other lender if state law requires it from for per the loan product. Thanks

Even when its back in service and cash flowing?

I'm sure you'll have to find out with every lender you talk to. The 21e requested from you seems to come from a MA state law

0 Votes

Boston, Massachusetts

Quote from @Michael Hague:

Hello, I am building an adu to rent out and am wondering if anyone has ever done a cash out refi or how they funded this?

if I build with cash, I’d like to get most of my money back out.

appreciate any insight!

Mike

Hello Mike,

Depending on the property, for cash out refis it will depend on your credit and then the value of the property vs the loan amount on the property. If you have no loan on it and you want to do a cash out refi even better.

For funding the construction project, there are many ways you could proceed: hard money, private money, construction funding, etc.

I hope this makes some sense. Thanks!

0 Votes

All Forum Posts by: Dennis Muno

Dennis Muno has started 1 posts and replied 324 times.

Post: fha loan multifamily

Post: DSCR Loan to house hack? Will lenders be willing to do it?

Post: Tips on how to preserve credit rate when buying multiple properties

Post: Checking credentials of a Lender

Post: cashout refinance a commercial property

Post: Seeking any info about HELOC on New Property

Post: Multifamily Loan Types

Post: Multifamily Loan Types

Post: commercial lender question

Post: ADU cash out or financing