All Forum Posts by: Dominic Watler

@Matt Devincenzo

Canyon Lake, TX.

All of the units were rented at some point, but it was a drug infested, no contract situation.

How else would I find out zoning besides searching the counties website?

@Matt Devincenzo

There aren’t any deed restrictions or zoning requirements at the property that I have been able to find.

The only permits required to build here are for septic and driveways.

Due diligence is ringing in my ears right now.

I purchased a 2300 sqft, 6 bed room,, 4 unit multi family on the MLS in June of last year and have just completed a beautiful full rehab.

Only now to find out when having the fairly new (2018) septic system looked at because there were apparently components installed incorrectly, that the system is underrated.

The previous owners installed the system under an approved permit by the county for a 3 bedroom SFH of the same square footage.

And stupid me knowing nothing about septics missed it….

Sellers did list any issues with septic on the disclosures sheet and I mistakenly assumed that the county would not have allowed any bogus system to be installed as recent as 2018.

So, give it to me straight. Am I screwed?

The lot size is small and does not allow for the needed drip system foot print to accommodate 4 units.

I’ve contact a few attorneys today and waiting on a return calk to see if I have any legal rights since the sellers knowingly installed an undersized system and did not disclose the issue.

Who’s to blame? The seller, the county, only me?

@David M.

So after a lot of digging, I did figure out some options. FHA didn't really interest me because I don't want to be leveraged to the max with a higher mortgage and carrying a MIP throughout the loan.

You can get a Freddie Mac or Fannie May under your personal name and deed it back to your llc. Perfectly legal and fairly simple from what I’ve read.

Either way, it looks like it's going to work out with a DSCR which IS what I would prefer. Ask and you shall receive. Several lenders have reached out with fantastic rates and terms.

@Jason Bott

Very insightful. Thank you for the information. I didn’t intend on debating insurance policy specifics, but I suppose the more information that comes from all conversations the better.

This post did prove very useful tho. Several lenders have reached out to me that are VERY competitive on DSCR loans interest rates with 80% LTV. Right where I wanted to be.

@David M.

Ok, but again, how could I possibly invalidate an insurance policy if they KNOW I am going to be renting the units no matter what kind of policy I have.

@Jonathan R McLaughlin

If I’m renting 3 of the 4 units, wouldn’t I be covered with commercial insurance?

@David M.

All good info. Yes, I’m aware I would be smudging a little some to make either personal mortgages work. Some may frown, but to me it’s trivial.

Consensus is in. I appreciate the feed back.

@Brittany Minocchi

The CU, yes they are stating that since the utilities will be in my name I can use it as my primary residence since I do not own another home as long is there is not a tenant lease on the unit. Which there wouldn't be with STR.

Getting 80% Ltv to recapture the interest I’ve paid with the hard money rehab loan and saving about 2% interest would be great.

The FHA would also be under the guidelines that I occupy one of the units. Which I wouldn't full time. It would be treated more like a vacation home for us. We do intend to use the units for ourselves, friends and family periodically. But it will mostly be used as an Airbnb. Are cash out refi possible on fha under your personal?

Hey guys and gals.

I’ve been in real estate for exactly 1 year and have flipped 2 properties so far with one more about to go on the market.

I am currently renting and own no homestead.

I have a 4-plex in central next with lake views that I am getting ready to refinance and use as an AirBNB that will be my first BRRRR.

PP: 225k (private partner funded)

Rehab: 225k (hard money)

ARV: 600k

The property is currently owned by my LLC.

My dilemma is with the refinance.

So far the only 30yr DSCR refinance on investment property I have found is with hard money lender at 8%+ interest, 75% LTV. 

My credit Union that my personal and business accounts are with recommended to me that I could put it under my personal name as my primary residence with 80% LTV at 6.75% if utilities are in my name.

I've also heard chatter about a FHA refinancing on Facebook forums, but I don't know how much merit there is there.

Since this is my first rodeo, I'm not sure what the right move is. Pulling 30k out of the deal and saving on interest really does sound good, but I'm hesitant on having liability for a STR.

Any advice or insight would be very appreciated from the vets.