All Forum Posts by: Adam L.

More and more agency's are adding these fee's to their agreements. I would expect most to adopt some sort of admin fee relatively soon. It is your right to push back but it will come out of your agent's pocket. If they are working hard for you my suggestion is to write into the contract that all agency related fee's (buyer/seller) are to be paid by the seller.  

Fannie is ten. Generally a single lender will have a maximum amount financed for one person. So, for example my company may have the ability to do 10 loans for a single person but not in excess of 2m in total loans. If you can qualify, they are out there. 

@Rob K. I will have to look into the law here in MI. Thanks for bring this up. This could totally throw off the strategy. 

@Sean T. There are still plenty of condo projects to be had here in the detroit market ... haha. no it's not that bad. but there are still a few diamonds in the rough. Thanks for your input. 

@Eric Thanks for the input

Has anyone bought out or bought enough condo units in a single complex to have control of the project. 

I have a proposal in front of me where an investor would like to buy a significant amount of condo units within a specific complex. The association has a lot of cash on hand in their reserve account. We can rent out the units and have a good return. In addition, we would look to return some the reserve cash to the condo owners, including ourselves.

(Obviously, we would still keeping the correct amount for repairs and a functioning association). 

Thoughts? 

@aarontrommater  Its all about the loan officer. the source of funds in the conventional world is some what irrelevant. If your broker is a good broker they will submit your loan application correctly and there should not be an issue. Expect to have your broker come back 3+ times for additional paperwork (this is normal these days). Freedom mortgage is a fine company. Most of the review you find online are a result of poor loan officers or brokers take applications for people who were not going to get approved to begin with. A lot LOs/brokers will throw spaghetti at the wall and see what sticks! 

In SE MI you may want to try Bank of Birmingham or more state wide MBank. They are smaller lenders who are hungry for 5+ units buy and hold. Not so much for the fix and flip. 

Couple of things: 

As a mortgage loan officer- close on the FHA deal first. FHA is only allowed for primary residences. If you do a simultaneous deal, even if it is all cash, it throws red flags everywhere. There is a lot of mortgage fraud around FHA and people claiming that the home is their primary and it is not.

Secondly, even if the deal is purchase in cash there is still debt that needs to be taken into account on your FHA deal (IE- property taxes and insurance).

Lastly, there is a form that accompanies all residential mortgages called a "Undisclosed Debt Acknowledgement". Basically saying you must disclose all debt that has been open between the time your credit was pulled and the time your loan closes. penalities include: "It is illegal for a person to knowingly withhold debt obligation information regarding a credit application to a financial

institution. Withholding such information is bank fraud. Bank fraud is investigated by the Federal Bureau of Investigation

(FBI) and is punishable by fines of up to $1,000,000, or up to 30 years in federal prison, or both."

 My suggestion- buy the investment home with a partner and have them put the debt (hard money) in their name. One thing LOs/brokers/banks hate is new debt showing up before the loan is closed. 

@John M If you can do it conventional will give you more options down the road. 5%dp will lessen your cash to close (there isn't a 1.75% funding fee that is included in FHA loans). If there is rehab work that needs to be completed, you can wrap that into your loan (depending on the severity of the rehab). Most educated lenders will have options like a 203k loan or a homestyle loan (fannie mae). This can lead to increased cost due to draw fees but if it keeps more money in your pocket all the better. I do a lot of rehab loans throughout the midwest for my clients and would be happy to answer any questions you might have.

Thanks everyone. Great advise. I appreciate it.