All Forum Posts by: Eric Telese

@Bonnie Low

Right. I get the water leak thing because that can lead to a lot of potential damage. But the appraiser wrote “no active leak present”. Yet underwriting is asking for licensed plumber to look at it. Pretty annoying, who should pay for this? Buyer or seller? Assuming us because its our bank giving us the issue? Its frustrating since we already had it inspected and showed no issue here at all.

For the hvac units... they are working. But maybe since they are old? I mean this is general stuff in an investment. Of course we are going to have to replace them at some point.

Hi,

We are currently supposed to close in a few days on a two family property. Appraisal came in 11 days ago. Now the bank is giving us an issue with some water damage under sink and saying they need a licensed plumber to inspect the area. Also are asking for a licensed HVAC tech to give a report of the units. 

We had our inspection and there were no issues with any of these. The seller took care of some of the water damage today and there are no active leaks. 

Is this a typical ask? I get the water damage thing because mold can begin growing. But a licensed plumber? There are no leaks. And for hvac, why should this matter? We know the age and condition of the units and know we will have to repair/replace in the next few years. What does this have to so with the loan?

@Bob Daniels agreed. I'm not complaining, just trying to figure out if I can make this work without using FHA.

@Jacob Sampson @Account Closed the purchase price is $200k under ARV. The rest of my income is off the books which is good for some reasons but bad for these reasons...

@Nathan Williams thanks for that I will inquire. Thinking it is probably for one of their FHA products.

Hey all,

I just got a property under contract. It is going to be a primary residence. A few local credit unions have said that my debt to income ratio is too high to get approved for the loan amount I want. The reason is that I have a rental property in GA with a partner, and the full amount needs to be counted towards my expenses when calculating DTI, regardless of the fact it is making us profit. We have only owned the rental since January, so it will not reflect on my current tax returns. They can use leases, but since I own half of it, they will only use half the income against the full PITI payment.

The only other expense I have is a $190 car lease. The rental PITI is $950. Rental income is $2320/mo. Personal income is $78k. Proposed PITI on new property will be $2900 (including PMI).

At first glance, my DTI is going to be over 50%, which is too high for Fannie/Freddie guidelines. Are there any conventional lenders who are able to get more creative here? Should I be going to my local banks and shopping around trying to see if they can do something different? I feel like there has to be some way to prove that the rental is making great income then increase my income, while decreasing that rental mortgage expense. Are these guidelines super strict? Some lenders have been giving me different answers with how long they need the leases, if they need tax returns, etc.

I know there must be a way to get this done creatively without needing a co-signer and also not having to do FHA. Any help here is much appreciated!

@Ben Haab

@Ben Haab The only reason I say own agenda is because it seems like he may have a buyer. He also has agent friends that he has had by, who of course said to list it for 500+ (without seeing condition of inside). I'm sure he will get a kickback off of their commission for doing repeat estate sales together...

1- I CAN bring more money for sure, but I don't want to because i have a 100k rehab ahead of me, which I want to keep reserves for.

2- It was appraised for 430k and 420k 2 months ago. I honestly think its worth less in this condition, but unfortunately I do believe someone will come along and pay more... I'm using this as a smart primary purchase starter home with good value-add opportunity. Whereas someone else who wants to live there forever may not care about paying a little more, just happy to get something under 500k (which is hard to do in this area right now).

@Robert Tucker I have not used this lender before. I am thinking to get pre-approved with multiple lenders so that if appraisal comes in shy with one, there may be 5 others who will loan on it.

To your statement- "He has to make sure that he is dealing with someone who isn’t going to come up short at closing".

Well I am well approved for this actual mortgage, so getting the loan isn't the issue. It seems that they are just worried it doesn't appraise to the $410k, 3 months from now. Also, how does my down payment make any difference? If he has a buyer who is putting 40% down, and the bank values it at $390k, that buyer is going to ask for a lower price, come up with difference, or walk away, right?

• -My point here is that he wants to bind me to this guarantee to come up with the difference BEFORE the bank even makes their valuation all because THEY can't close for 3-4 months.

@Matt M.

Exactly. This attorney has his own agenda it seems and is trying to blow up the deal. He is backing me into a corner asking me to guarantee a price even if my bank says its not worth that amount..

@Matt M. Yes it seems that we will be fine for the loan as far as conditions go... 

Now I have figured out their main motive- The seller is trying to basically get me to agree to no appraisal contingency, without doing so within the P&S agreement.. He wants a separate contract that the bank won't see that says something like: If the bank doesn't lend to me on the $410k agreed upon price, I will come up with the difference in the loan they give me to meet 410k.

Is this as absurd as I feel like it is? They are clearly worried that the property won’t appraise for they price we agreed upon. Why would I agree ahead of time to purchase if my bank says it is not worth that amount..

I think you are saying to get an inspection period where I can utilize an inspection report... but also have the bank appraisal done in that timeframe. Say I don’t like something in the inspection and back out because of that (if the appraisal comes in low).

Am I following correctly?

Heres the next thing- I did already have an inspection done and this purchase will be as-is condition, so I think that blows that idea out the window?

@Chris Mason I’m actually not following 🤔🤔