All Forum Posts by: Kevin Woodard

I think planning backwards from your desired end state will allow you to know what you need to ask for and plan now. What is the income you're looking to net? Conservatively speaking aim for a DSCR greater than 1.00, let's call it 1.2. That will give your PITIA… so on and so forth.
Another place to build in some room for error is ARV aim to keep the total cost of your project below 75%, 70% and you're marginally safe. The last bit would be a safety margin with construction in the event things don't go as planned.

@Aaron Bihl It's an interesting concept and makes sense on paper. However, at the end of the day from the lender's perspective it's extremely risky. Same reason why you'll still need reserves, in certain instances, even if you're getting cash out after you refinance.

@Nicholas Mangiafico partner with a good realtor that knows the area and can look for your target property. I would focus on light rehab to increase the ARV and allowing you to pull most, if not all of your initial capital out of the deal. As you become more comfortable and grow your network, you could look at venturing into heavier projects. Hope this helps!

Lots of great advice in here already. Emotions are part of the human condition and it's what makes it fun. With that being said, sticking to the numbers and developing a game plan will ensure efficient execution. What are you thinking you will have to bring to close?

The DSCR products will follow federal rate action. They tend to have pre-payment penalties which could be paid down. Leverage and the borrower's credit are key factors that influence the rate on an individuals property. They are fully amortizing and can include interest only periods.

Regarding the ratio of NOI to PITIA you're aiming to be 1.00+.

Are those SFR currently being rented out and non-owner occupied? If so, then a DSCR loan could be a useful tool for you.

Congrats on your EAS and thank you for your service. 

What type of deal are you looking to fund with this loan (e.g. Buy and Hold, Fix and Flip, financing for a primary, )?

How is the loan structured? Short term I/O or is it fully amortizing? The rate will likely be higher than a bank but also what are you trying to achieve with 80% leverage compared to 75% the bank is offering?

There are a lot of good resources out there. Lend2Live should get you a solid 85-95% solution. 

Hope this helps!

I think a better way of looking at it would be: is the monthly cost more than I want to pay compared to the pay out in 3-6 months. Did you pay everything else out of pocket?