All Forum Posts by: Jack BeVier

Hey Jason, we have a debt service coverage ratio (DSCR) product. While there are a few nuances, its a pretty simple product. The loan amount can go up to 80% of value, but subject to the property having enough rents coming in to service that much debt, after you take out insurance & taxes. There is some variation between lenders as to how they calculate the DSCR, so I'd recommend speaking to one of these lenders directly (we do this kind of loan) to get a quote. They don't take long to produce. Pricing will be determined by your FICO and the desired LTV. Rates are in the low 4s to low 5s, right now. I'm a huge fan of DSCR loans because they allow real estate investors not to be constrained by a debt to income ratio, which is a challenging calculation for self-employed folks, particularly real estate investors who tend to have a significant portion of their net worth 'off balance sheet' in their real estate. Anyway, hope thats helpful.

Yes some national private lenders are offering this debt service coverage ratio product. My company Dominion Financial closed 160 of these loans last month. Most of our business is refinancing out local banks that arent serving real estate investors well anymore. 

Hey @Kristin Haug, 6 month seasoning was/is typical from local banks, which used to have the best rates so it was worth the pain/wait. The 'new' debt service coverage ratio (DSCR) driven products are more attractive, though, IMHO. 30-yr fixed rate, 30-yr term, rates in the 4s (right there / better than banks) and no debt to income ratio BS. Most max at 75% LTV. 80% LTV is possible if the rent from the property supports the loan payment. Hope that's helpful.

@Timothy Miller yes. 6.5% is way too high. You can refinance in the 4s with a 30-yr fixed rate, 30-yr term, based on the debt service coverage ratio (DSCR) of your property. Whether you're retiring at 65 or 85, having access to tax free refinance proceeds and decreasing your cost of capital by 200 basis points is a no-brainer. Don't over-leverage the property, but with a DSCR above 1.2x, you should be in good shape. Hope thats helpful.

Personal DTI used to be the the constraint to rental portfolio growth. We've been slogging away since 2002 and are up to 762 rental properties. That said, in the past few months the DSCR loans are now at rates that are more competitive than banks. 4 handle interest rate (down to 3.75% with buydown), 75% LTV cash out, 30yr fixed rate, 30 yr term. Those terms make it exciting to be growing a rental portfolio. With inflation on the horizon, I think that hard assets and long-term fixed rate debt are the places to be. My 2 cents.

Seasoning is a serious frustration. We designed our program with @Chris K. your issues in mind. 3 mos seasoning, 75% LTV cash out, LLC ownership, 30yr fixed rate and 30yr term, rates in the 4s (down to 3.75% with a buydown, actually). The loan amount is sized based on the value of the property and the rent. Your personal DTI is not a factor (don't even ask for tax returns). 680 min FICO, though. We own 762 rental properties and this has been a game changer for us. It only became available at these rates in the past few months.

Hey @Christopher Helwig, if the reason that you're keeping the 2 in your personal name is the rate, you should consider refinancing. The FNMA product used to be a no-brainer because of the rates, but now you can get a 30-yr fixed rate, 30-yr amortization in an LLC. Rates are in the low-mid 4s (buydown available down to 3.75%, actually). The program was designed to be in an LLC. I think that banks are going to lose a TON of business over the next few years to this program. Hope thats helpful.

Hey Justin, totally understand. Historically, we've had to deal with the same seasoning issues when building our rental portfolio (now at 762 single family rentals in Baltimore City), which are super frustrating. We also lend private money (fix & flip and long-term rental) and we spent COVID addressing the frustrating gap between credit unions and FNMA. We launched our 30-yr fixed rate rental loan product Thanksgiving 2020. Its DSCR based (no tax returns) and seasoning is 3 months. I 110% agree that a 6 month seasoning requirement is arbitrary and lacks common sense (if you're a real estate investor, which we are). Our 30-yr program is a game changer - we would have gotten to 762 properties SO much faster if we'd had this product available. Rate is 4.25%, 30-yr fixed rate, 30-yr term, LLC borrower. Bank rates, 30-45 day closing timeframe, no tax return or DTI calc BS. 680 min FICO. We closed 161 loans last month. It's a game changer. I'll take the Pepsi challenge against any non-FNMA loan in the country.

I was extremely fortunate to get into single family real estate investing at a young age (23) and it has made all the difference. I'm still frustrated by the lack of financial education and real estate education opportunities that are experience based. My partner and I have built up our real estate investing platform to 15 employees in development, 15 employees in property management and 60 employees in our lending business. I designed this program to give folks who are starting out in real estate investing the opportunity to learn while doing. It's a giveback from us, and I hope it'll help change lives. 

Dominion Single Family Real Estate Investment Apprenticeship Program

Dominion is a vertically integrated real estate investment company located in Baltimore, MD. Operating since 2002, Dominion owns & manages 750 single family rental properties, buys & renovates 100 properties per year, and originates $60M/mo of fix & flip and long term rental loans to real estate investors nationwide.

Over the course of 2 years, Apprentices will be immersed in Dominion’s operations in Baltimore City, MD. This is a full-time commitment. Apprentices will be paired with departmental managers, each of whom have 10+ years experience in their field of expertise, and rotate through Dominion’s operations for 3-5 months each in Acquisitions & Underwriting, Construction Management, Property Management, Sales & Marketing, Accounting & Finance and Data Analytics. Apprentices will be expected to learn quickly and become contributing members to each department during their rotation. Training outside of normal business hours will be made available and candidates are expected to take advantages of those educational opportunities in order to augment their skills.

During the program, Apprentices will be provided housing and a $500/wk stipend.

At the end of the program, Apprentices may be eligible for employment and/or other entrepreneurial opportunities in the single family real estate industry.

Interested candidates should reach out to me! 

Your youth is the greatest asset you have, and it would be a shame to miss that opportunity. I started investing at 23 (38 now) and could have retired a few years ago. The amazing thing about real estate is that time is your greatest ally. I might suggest that you guys stick to 'nicer' locations, where she feels more comfortable. The greatest risk and war stories come from lower end real estate. If you buy even 1 rental a year (WHEN YOU'RE YOUNG!!!), its tough not to retire early. 

Take it easy on pitching her big ideas like flipping multiple houses a year. Ease her in with 'pretty' rentals, but START YOUNG!!