All Forum Posts by: Elias Halvorson

Quote from @Brandon Williamson:

Yes personal loans are an option but rates are usually higher from my experience.

Rates are only slightly higher than DSCR loans, and since the fees are SIGNIFICANTLY less, it's a much better option.

Quote from @Brandon Williamson:

I"m looking for a DSCR LENDER who goes to down to 50K - 75K. I'll take take of rehab myself.

 But WHYYYYYY!? I see these posts occasionally - Is a personal loan an option? The fees are so much less doing the personal loan. 

Hi Kaylin, 

I will echo what everyone else said. I would try to qualify for a 2nd/Vacation home loan first and if you didn't your fallback could be a DSCR. Just note a DSCR will often have a pre-payment penalty and has higher fees/rates.

I don’t know why it would be different in NJ, but they (renters) should be paying utilities. If you decide to cover, make sure something in the contract stipulates you will cover up to xxx amount. Otherwise, the renters could be bitcoin mining or driving 2-3 electric cars and you’re paying for everything. 

Quote from @Karolina Powell:

The one with the repair problem and the reserves problem is a DSCR loan

The problem with the DSCR loans is usually there are very few set guidelines in each bank so their underwriters often add requirements at the behest of their investors. I have two write now and both have been a nightmare. Should seemingly be easy, but rarely are. 

That is in the past. But like I *meant* to write, I havent done one in a couple of years. However, you can put that commercial rent as your income. That should be enough to at least get you 20-30K. Not sure what you are planning on using the 50-75K for but if it is just living expenses, etc while you start your new career than just go with the 20-30K personal loan. Much better deal for you in the long run. 

And you still own the commercial property at some sort of a net positive per month so you can list that. In fact, you can list the entire amount as income on your application. SUre you have a mortgage on it, but let them do the homework of subtracting your mortgage amount. 

Just put income from your last job and put an estimate of what you will make in youre new job. I done a personal loan in a couple years but I didnt even have to show paystubs on some of the ones I've done. 

Quote from @Wil Reichard:

I have been struggling to find someone to refinance a fully tented industrial building of mine.

I was originally looking for a 75% loan to value. For a reasonable interest rate, knowing today’s markets. I’ve been told by many local banks and credit unions that they will not do the deal.

To put it simply, I’ve been told that I do not have enough skin in the game myself in order to cash out some equity.

We bought the seller financed with only a $30,000 down payment. There is an $80,000 assignment fee so we ended up paying a bit more but our only down payment towards the building looks to be 30k. We’ve put maybe 25k into the building since ownership (which was June 23’), but apparently it isn’t enough seasoning for thanks to want to cash me out.

Here are some of the details:

Purchased: June 2023

Size: 4,300 SF

location: Greenville, SC

Tenant: NNN lease, 3 year lease with renewal options that commenced in April 2024.

Tenant pays $6,200 total. $5,000 net after taxes and insurance Internet is responsible for maintenance.

Down payment: 30k

Value: $725k +

Current loan: $440k

I just wanna pull $50-$75,000 of equity out of the property without being killed on a really high interest rate. My interest rate right now is 6.25%.

My question is, should I give up looking for a lender or private lender who would finance this at a rate below or around 8%? Lastly, this loan would need to be heavily dependent on the actual property instead of my tax returns as I just quit my job a few months back to go full-time into Real Estate.

 I would highly recommend a personal loan from SOFI, or maybe a local credit union. I have got 4x personal loans ranging from 40-85K before, but it is all dependent on income. With your new job it may be a little harder to get 50-75K but you can try. Although the interest rate will be higher (maybe 8-9%), there will only be 300 or so in fees vice the 10K you're likely looking on a cashout refinance. Further, 6.25% is very good for an investment property, current rates are higher. 

So in short, my recommendation is to get a personal loan for as much as you can and stretch the repayments out to 72-84 months. 

Quote from @Sam Chan:

Hi

We purchased an CA investment property when rate are at 8.25%. I wonder when I should refinance. Some options are:

-No point - rates at 7.75%

-Can buy down to 6.99 but cost 1.5%

-Wait till next year or later when rate goes down.

I also have to bring the LTV to 75%. Currently, it is at about 77% LTV, based on the appraisal.

TIA

 Hey Sam, 

Those offers/rates are terrible. I just closed a DSCR cashout refinance with better terms than what you are being offered. I would definitely shop more, neither of those deals make sense to me. I am happy to take a look and tell you what you should be getting (there are some pieces of the puzzle missing such as credit score, etc.)

V/r,

Elias