All Forum Posts by: Jeff Shumway

@Tiffany Kho this is correct. If it is a 10% down second home you must retain control over the property. It cannot be under the control of a property management company. It has to be available for your use since you are buying it as a second home with the intent of using it at least part of the year. There is not minimum number of days you have to go on vacation (i.e. no 14 days requirement). Any lender that has a requirement like that is lender specific. 

If you purchase it as strictly an investment property, it can be under the control of a management company. 

The appraiser will use comps to determine the value and lenders will fund the lower of the appraised value or the purchase price. If there are no comps available, the appraiser may go to a different but similar market to find comps. If it comes in low, you also have the ability to submit a reconsideration of value (ROV). There is no guarantee an ROV will be successful but it can be worth a shot.

Hey Ankit, try contacting Real Property Management Leaders. Mark Dowsett is my contact there. They are local to Tampa. 

Hey Bryan, it will depend on a couple different factors. Are you looking to buy a primary residence or an investment property? If you are looking to buy an investment property, there are loan programs that do not look at your debt to income ratio at all. These are called DSCR (Debt service coverage ratio) loans. They only look at the anticipated rental income from the property, assets to make sure you have enough to down payment/closing costs, reserves (if applicable), and your credit. These are for investment properties only.

If you're looking at buying a primary residence, then yes DTI will come into play. You will definitely need to speak with a lender to see where you stand.

I always recommend getting a preapproval first so you know how much you will get approved to buy. A preapproval will give you an idea of the monthly payment and total cash to close. Most realtors will not take you to look at a house without a preapproval letter. They don't want to potentially waste their time if you end up not being able to purchase a particular property. 

For conventional loans, there is no exact distance requirement unless the individual lender has an additional overlay. It just has to pass the smell test and make sense in underwriting. 

This is true for every single conventional loan lender across the US. Some banks may have a portfolio product with different down payment requirements but it will not be a conventional loan. 

Hey Nikki, I would possibly consider looking outside the Tampa Bay market. Perhaps further North in Hernando county or even West in NPR area. If you are open to a little farther away, Jacksonville may be an option too. 

I would also absolutely advise against low balling in the Tampa Market. Most every property is selling well above listing price. Your offer very likely will not be taken seriously. I am also going to advise strongly against "waiting for the market to cool down." There is no guarantee the market will cool down or prices will drop. I cannot tell you how many clients I have who did the same thing last summer and now prices are even higher. It's absolutely a gamble to assume prices will go down and a costly gamble if you do not get in the market. 

Personally, I would recommend staying away from condos for a couple reasons. 

1. As you mentioned, the HOA fees will take up a big chunk of your profits. But if it works and meets you needs then no biggie. The bigger concern with a condo is the HOA regulations. They can definitely impose restrictions on you as a landlord. Not sure what kind of loan you were approved for, but conventional loans tend to have tougher requirements when it comes to condos. Only a certain portion of the condo project can be investor occupancy, the HOA must have certain reserves in their budget, etc.

2. Condos/townhomes appreciate less over time than a traditional single family home will. This could make any future cash out refinances less profitable for you than a SFH.

3. Condos also will always carry a higher interest rate than a single family home. So in addition to the HOA fees, you will be paying extra in interest.

Hey Jillian, no lender will allow you to use your own appraiser. It's strictly not allowed for conventional/primary residence loans. 

Keep in mind that appraisers tend to only get negative reviews online. No one remembers or thinks to leave a positive review for their appraiser if it comes in at or above value. People typically only think to review their appraiser if they have a bad experience so the reviews are typically very skewed. 

Hey Karene, is the new job in the same field/line of work? If so, he can apply for a mortgage immediately. During the mortgage process, lenders request a verification of income/employment from his employer and they will notate exactly how much he is making. Lenders will also request a similar document from his previous employer. This all pertains to a conventional loan- if you are using a conventional loan you are most likely using his income to qualify for the property so the verification is required. There are other loan types out there that do not rely on your personal income at all so the verifications will not be required.