All Forum Posts by: Jay Hurst

 @Casey Graham Generally, there is no seasoning requirement for simply refinancing what you owe. So, anyone should be able to do it. You would want to compare apples to apples however. Rates are not the only thing to look at when it comes to all loans but especially true when it comes to DSCR loans. Most brokers will quote you rates/terms with a 5 year pre-payment penalty. That can be VERY costly down the road, so you want to understand that cost. We do most of our DSCR loans with either 1 year or ZERO pre-payment penalty.

If you want to pull out cash before 6 months based on the improved value there are products available but they are all going to cost you more then if you waited 6 months from purchase date. The prior to 6 month products will have higher rates as well as upfront costs and pre-payment penalties, so again it pays to understand the options. But, it also may pay to simply wait until 6 months.

 We have the exact program. Love to chat. 

 Are you hoping to pull cash out using the improved value of or just refinance what you owe? 

 How long have you owned the three rentals? 

 reading between the lines here I assume you will have some sort of motocross track on property?  Have you looked into the complexity of insuring a dwelling and something like that on the same parcel?

 In my experience, and this will not be terribly popular here, but no you should not buy out of state if you cannot visit the area before you purchase if. And no again if buying a rehab project and if  you cannot visit during the rehab process.

My experience I am mentioning? Well it is doing loans for folks who bought sight unseen and trusted contractors/turnkey providers who sell the dream but in the end do the absolute min in rehab work (even though charge for a much better job) and/or sell a buyer on a class B type neighborhood that is  reality a class D neighborhood in an already low income town. Values are almost much lower then promised with tenant qualify also being much lower then promised. Are there folks who do not operate this way? of course, but you are taking that chance with your hard earned money. if you cannot afford or do not have the time to make a few trips out of state investing is just not a good idea  for many reasons.  

 If you are not well capitalized, meaning you can not pay off the loan if called, stay away from sub to. 

 Non conventional just means the loan will not be sold to Fannie/Freddie so they do not have to follow those rules. I do not lend in NC so I cannot help but I have several options with 20% down on a 2-4 unit. I would suggest going to the find a lender tab here on bigger pockets to find a local lender who has the same products. 

 Conventional loans do require 25% down on an investment property. Those rules are set by Fannie/Freddie NOT your lender, or any other lender in fact. Also, conventional lending will NOT allow you to get gift funds OR borrow unsecured funds to help fund a down payment on an investment property. You can borrow against a 401k or another property you own for example, but that would a secured loan. You also cannot use a second mortgage (from HML/private lender) for a 2-4 unit non owner property. The 25% has to be your funds.

Now, there are non conventional options that would be a bit more flexible but even most of those programs will require at least 20% down with no second mortgages filed on the property. 

 @Daniel Tanasa   Unfortunately that is not correct when it comes to mortgage debt. (and it does not matter if their is a servicer involved) You are correct for any other debt like for example a car loan. If you can show that someone else has paid the loan on-time for 12 consecutive months you can exclude that debt from the debt to income calculation. BUT, for a mortgage the party making the payments has to be obligated on the debt. So, in the case of a sub to transaction like this one the OP is the party making the payments BUT is not obligated on the debt. The below comes from THE word on the subject, the entity that will be buying and insuring the loan, Fannie Mae.

https://selling-guide.fanniemae.com/sel/b3-6-05/monthly-debt...