All Forum Posts by: Kevin Vasquez

Quote from @Kevin Vasquez:

Background context:

I have a 805 credit score, low DTI and attempting to secure the lowest cash out refi to pay off a debt ($50k). My broker is saying the broker fee is a standard $3000 amount bc the amount requested is under 100k and advised the minimum I am able to to pull out is $75k. The property is paid off, fully remodeled and has a tenant in place whose rent exceeds the monthly loan amount. I am attempting to refi under a DSCR loan proposed interest is 8.375%. Estimated closing cost is $7776.80 on a $75k washout refi. Does any of this sound valid?

 @Kevin Vasquez You would also need to ask what the pre-payment penalty is on the loan. DSCR loans can have ridiculously long PPP. and why DSCR in the first place?

Another vote here for Detroit.

It seems folks are finally waking up to the progress that's been unfolding there for the last 10+ years. 

I own 14-doors there myself. Happy to shoot some resources over to anyone interested.

Rate seems a bit high (at least ~0.25% I'd say) based on the info you provided and for a 5 year PPP, but that lender might have more info than what everyone here has. I typically price people out with a 3-year PPP juuuuust in case they decide they might want to sell or refi a year or two into the loan. Another thing worth mentioning is the seasoning period - how long have you owned the property? Most lenders require 6 months. Also, none of those origination fees make sense for a $116,250 loan amount. 

@Kevin Vasquez

It depends on what you are planning to do in the near future. If you think rates are coming down OR you want to sell sooner than later, i would take the least restrictive prepayment penalty, lower origination, and higher rate. If you think rates aren't going to move or you just want to lock in long term, take a more restrictive prepayment penalty and buy the rate down. 

I would ask the broker if they have a 36 month prepayment penalty option. (3,2,1,0) also the 1%/2%/3% origination fees don't match the dollar amount listed in the lower section. 

1% of 116,250 = 1,162.50 but listed below is a charge of 2k. 

Quote from @Kevin Vasquez:

Quote from @Devin Peterson:

Quote from @Kevin Vasquez:

Hello everyone.

I picked up a small condo in the Bradenton FL area off a wholesaler and recently rehabbed it. Everything is done and I am considering using a DSCR loan to pull a cash out refi. I've typically only had experience with conventional lending however this time around I'm exploring the DSCR route. My broker sent me these scenarios to review, majority of the difference are

the point buy down amounts. 

Can someone take a look and give me their opinion on which would be the best route to take?

 Just after a quick review, rates seem a bit high for the amount of points being charged also isthis is at a 5year PPP or 3 year 5-3-1? There are better PPP options like a stepdown 3-2-1 or just a 1-1-1 buydown for cheaper cost. Always get some second opinions and quotes from multiple sources

Thanks! This is a 5 year PPP into s step down.How far off would you say are these rates compared to what you've seen with a DSCR?

 Whats your credit score?

great question! i'd take the 3 'more expensive up front' options, for each one list the difference in closing costs between that option & the 'cheapest up front' option, then compare your cash-on-cash return for each for the initial additional investment vs. the saved interest in year one. that would give you a starting point for if the extra investment up front is worth it or not per whatever your normal desired COCR is for any investment. but another thing to consider is, how long is the rate fixed for? do you think rates will go down eventually and you'd be able to refi out within a few years to a 'cheaper' loan product? this is to say like.. how long do you plan on being in this loan product, because if it's not very long, maybe it's not worth it to buy down. but if you're planning on staying in it long term, the return on investment will absolutely be there by buying down your rate. hope this helps!

Quote from @Kevin Vasquez:

Hello everyone.

I picked up a small condo in the Bradenton FL area off a wholesaler and recently rehabbed it. Everything is done and I am considering using a DSCR loan to pull a cash out refi. I've typically only had experience with conventional lending however this time around I'm exploring the DSCR route. My broker sent me these scenarios to review, majority of the difference are

the point buy down amounts. 

Can someone take a look and give me their opinion on which would be the best route to take?

 Just after a quick review, rates seem a bit high for the amount of points being charged also isthis is at a 5year PPP or 3 year 5-3-1? There are better PPP options like a stepdown 3-2-1 or just a 1-1-1 buydown for cheaper cost. Always get some second opinions and quotes from multiple sources