All Forum Posts by: Kristen L Garner

Hi Robert, Sending you a DM. I work with a few loan programs in TX that allow you to select a direct appraiser rather than go through an AMC. Working with an appraiser with investment knowledge can make or break deals that need specialized knowledge such as STR rental income. Thanks!

It sounds like the nonQM sector will work well for you! It includes products such as DSCR where DTI isn't a qualifying factor. DSCR would only work for the investment property. For your primary you would need to use products like Bank Statement Loans, P&L Loans, Asset Based Loans, etc.

Or if you want to stick to regular conforming loans and work around the DTI you can note some debts to be paid at closing with the funds

Hi Rebecca! There are tons of options and ways to structure when it comes to DSCR. Some things to consider:

* usually used for single family or 2-8 multi family unit properties (fits your scenario)

* must be for investment, non owner occupied (if looking for a product for alternative qualifying solutions for owner occupied there are other products)

* can close in a personal name or LLC

* usually 80% LTV for a purchase (20% down payment) & usually 75-80% LTV for cash out refis

* prepayment penalties vary and are optional, but the higher the prepayment penalty, the lower the rate / options typical range from no prepay all the way up to 5 year prepay and structures vary for how those penalties work (3 year is my most popular by far)

* appraisal most likely required and paid out of pocket during transaction

* can be used for long term, mid term, or short term rental properties 

* generally 1%+ is the desired DSCR ratio but you get better rates if the ratio is higher (usually rate breaks kick in at 1.15%+ or 1.25%+) and you can still get the loan done if ratio is lower than 1% but the rate will reflect that (DM me if you wand help learning how to calculate the ratio)

* the average time to close is 21-30 days

* fees vary lender to lender and product to product, but $1595 underwriting plus title fees is pretty standard

* 700+ credit is preferred to get max LTV, but plenty of options if credit falls below that

* a typical loan minimum is $75k (have limited options for $50k+) and typical loan maximum is $3-4m (have limited options for $4m+)

* 3 months reserves usually required, having 6+ months will usually result in better loan terms, 0 reserves can still get the job done if you go with a program that allows you to use the cash flow as reserves

* 30 year fixed, IO, and ARMS available

Hi Christopher, welcome! I personally invest from out of state in Indianapolis (my hometown). But I work with investors all over the US who take the out of state approach to investing. I'd be happy to chat about trends I'm seeing and feedback I get about different areas if you'd like to DM me.

Hi Troy! I personally invest in Indianapolis but I work with a lot of investors who buy in the Akron area. I'd be happy to chat with you about what kind of numbers and trends I'm seeing in that area if you'd like to DM me.  Best of luck!

Hi Christopher, You could start by getting some data from a site like airdna to see what your numbers would look like. I would also check your area for STR rules and regulations.

I don't personally own a short term rental but a lot of the investors I work with do and it can certainly increase your cash flow if done right! I work with one investor who has long term tenants in front units on his lots and STR on back units. The long term tenants came first and he gave them a small rental discount in exchange for their permission to add the STRs. That strategy and communication worked well for him.

Best of luck!

Hi Kate! You are spot on about the new opportunities offered by the change in guidelines. I'd be happy to go over them with you if you want to DM me. FHA loan limits have increased as of Jan 1, 2024 and you can still put down just 3.5% for 1-4 unit owner occupied purchases. Conventional loan limits have also increased and the big guideline change lies here. Fannie Mae (conventional loans) now allow 5% down payments for owner-occupied 2-4 unit homes. This marks a departure from the previous requirement of 15-25% down payments for 2-4 unit owner occupied purchases.

Hi Erich, Congrats to you and your wife on your first property. I'd be happy to chat about different loan types and guidelines - lots of options out there to get the job done! Best of luck and cheers to 2024. 

I do a lot of income calculation from investor's look back history on both VRBO and Airbnb and most that I work with really increase their revenue once they add VRBO. Many of them say they are able to get higher quality guests and higher booking prices on VRBO, especially for more unique, rural, or larger sized properties.
From the financing side of things - you can use the income equally from any of the accounts to help qualify for loan products.

Hi Jason! If you'd like to DM me - I'd be happy to chat with you about the financing side of loans and how to use STR rental income to qualify for different loan products. Best of luck and Happy New Year.