All Forum Posts by: Dennis Muno

Hello Estela,

What's the location of the project? How much experience on title do you(and your partners, if doing with them) have in either fix and flip, buying, selling real estate in the last 36 months?

Do you have a plan in mind, budget, people to do the project, permits? What is your exit strategy(build and sell, build and hold)?? What is the total loan amount sought?

These are all questions that will be asked before any lender will proceed for financing on this project. 

 Hello Nicholas,

I would say before you call, you will need to have a budget, plan for the property(if rehabs/development needed), and at least people who will be in charge or rehab. Once you have these details, you should give at least 5 lenders a call to determine their lending rates and terms after you give them your information and then get information from them as to what documents they will require. Some lenders usually may ask for your experience in the last 3 years on title. For deals like these the lenders are usually different when it comes to demand/requirements.

You want to have a full map/outline of a plan, exit strategy(keep after rehab/sell for profit), people who will be in charge of rehab, plans for the rehab before you reach out to a lender For these "commercial type" deals you want to go before a lender prepared

With your information given, this seems doable. FICO is high. Do you know the market rents for the area? Is the in good condition?

Overall, this seems like a doable deal. Usually DSCRs will be a percent or more higher than residential loans because they are for investment properties, which have a higher risk than residential properties. For better pricing, a prepayment penalty will likely be added( the normal for DSCR loans)

 Hello David,

What is your experience in projects with you on title in the last 3 years? For projects like these these details will be asked. How many units for the small hotel? FICO? Details like these will matter for the financing for projects like these.

Also, why only SBA loans? Is there a reason why? I think it is best to keep financing options open and compare them all and see what you qualify for so you have options to compare before you proceed. Best of luck!

Hello David,

I believe SBA loans downpayment amount may be dependent on lender?? You'll want to compare offers from different lenders before you settle on an SBA loan offer.

Hello Kim,

So for these types of projects, it is great if you at least have a plan or budget in mind at least to start. If you can also vet  general contractors who are experienced in doing this and would like to take on the project for you that would be great. Once you have a plan for building you will have to find good land to build the property and get it under contract. Once under contract, you'll need to get financing.

Before you look for financing, you want to make sure everything is ready(plans, budget, general contractor and construction personnel, permits, if need be, strategy after project completion, documented experience, etc). Lenders will usually ask for all these before they continue with you and even decide to fund. This is overly simplified but a road map to start

 Hello Ku,

I'm not sure why the other lender said that. It could be from underwriting? I would say definitely get other lenders to take a look at it and see what options they may have.

You should be able to do a DSCR loan for the second property even with you owning your current home(obviously subject to lender approval).

Hello Claudius,

Depending on the lender, there may be different requirements per their guidelines. If this is for residential then it makes sense why everyone is asking for 2 years with your current job. If this is for an investment property, there are lenders and options away from that. Assuming this is for an investment property, there are loan products that could help you proceed, obviously, subject to lender approval and availability:

1. DSCR loans:

2. Bank Statement loans??

3. Private money loans

4. Hard money loans.

All these options are subject to each lender's guidelines and approval. 

It sounds like you are talking about a home loan though. If it's for a home loan, if you have solid work history and increasing income some underwriters may be willing to proceed. A bank statement loan lender(depending on lender) may be willing to assist you if you have good FICO and are not too much of a financial risk(high debt to income, negative credit history, rising income over the years, etc).

Congratulations! It looks like you have a plan coming up and it's also great the county has given clarification on what you can build. 

I think the next step would be to get a GC and then come up with a plan and budget for construction, in addition to permits. All in all, it seems you are moving along nicely

Hello River,

Do you have an end goal for this project? A budget? Plans/exit strategy after buying?

Lenders will ask these questions before they lend. Private money seems to be an option to proceed