All Forum Posts by: Ben Carmona

Most recent guidelines from the only source I know that's doing blanket loans other than small local banks

Minimum loan amount is $750k.
Minimum value is $100k per property. These are both flexible.
As with all commercial loans, this is based on cash flow
Dscr of at least 1.25.
Rate is 7%, amortized over 20 or 25 years.
Purchase is 80% ltv, and a seller held second of 10% is allowed=90% cltv.
Seller concession allowed
Minimum credit score is 650.
Sfr and up-must be at least 5 units total in the loan.
Borrower must own properties for at least 8 months, for refinance.
Up to 80% ltv for cash out-proceeds for business use.
The use of the proceeds for cash out needs to be documented.
At closing partial release will be defined in the note.

Need a strong file-3 years tax returns, personal financial statement, etc.
Must show a profit on Schedule C of returns.

90% stated is available for investors.

it's quite expensive though.

80% stated is also available a little cheaper but still expensive

there are really no conventional stated products now

I said "some" conventiona lenders but I should have just said tha I have never in the last 14 years run into a conventional lender that had a seller seasoning restriction.

If you use a hml for the purchase then a rate/term refi based upon the true value of the property will not be an issue so long as you meet all qualifying criteria.

This is still possible with cash out but you'd need to use a local bank or portfolio lender. They would do a commercial loan that doesnt have any restrictions. You wont end up with a 30yr fixed rate though. More like a 20yr am with a 3-5yr balloon.

Fannie Mae announcement 08-22
https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2008/0822.pdf

FAQs concerning the announcement
https://www.efanniemae.com/sf/guides/ssg/relatedsellinginfo/pdf/0822faqs.pdf

the biggest issue you'll have is that most hard money lenders wont do loans for owner occupancy.

since the loans are high rate/cost their consider business/commercial purposes therefore not available on primary homes.

What you'd want to use is the fannie rehab program that allows automatically converts your rehab loan into long term financing. It would be much cheaper like this.

As far as investors refinancing hard money loans, this can be done as a rate/term refinance (just the 1st mortgage lien recorded at closing) anytime or cash out after 6 months. From the way that I read the guidelines for Fannie, investors that use their own cash for purchasing and rehab cant get those funds back for 12 months. But Freddie doesnt have this, there's is 6 months for properties owed free/clear.

actually some of the guidelines posted earlier are a little outdated from 12/07. Fannie came out with a new announcement about this 9/08. Will attach on another reply.

why would you ever want a 95% loan. is this investment, I'm assuming so since you say "cash flow is good now."

if the property he is buying is investment then he may want to consider using a hard money lender

Harrison,

finder your end sources yet? You say Atlanta and Indy, right?

FYI..for all readers...
Sometimes lenders will impose their own internal guidelins.

For example:

Fannie clearly states that all properties held by a Corp do not count in the max # of property count. (they are not clear if both the title and loan have to be in the Corp but I'd imagine that's what they meant).

However, Suntrust clearly says in their guidelines that any residential property counts. This is even if the properties are blanketed by a commercial lien.

So we mortgage professionals doing conventional loans really need to know each lenders guidelines. (or at least read up on the before doing preapprovals and submissions).

90-95% with no pmi for conventional investment financing for Fannie REOs should be available shortly. Will keep you updated