All Forum Posts by: Derek Brickley

Hey Kenji!

A househack is definitely a great way to start building your portfolio, but from the sounds of it you would come across some issues of occupancy.  Do you own your primary now?  How far is the commute?  Would you be working remotely at all?  What is the benefit to you to move out of state?  

As long as you actually intend to occupy it, you should plan on living there for a year generally speaking.  At that point it would make sense if there was a change and you were looking to move out.  When applying for another primary residence loan (say in the future after your househack) if you are claiming that as your primary residence but there is no proof you ever occupied the property you would struggle to buy another primary residence in a short amount of time.  To me (and I could be incorrect) if you are already looking at reasons/situations for never moving into the property this would not be a primary residence and the Underwriter of your file would definitely flag that before you ever get to that point.  

Not that you need to live there for 30 years, and it is important to run your rental analysis based on when you move out but if buying it as a primary residence then there would need to be a very good reason you moved out/never occupied it, especially if you are trying to grow your portfolio with primary residence loans.

Hey Renee! Every DSCR lender will be a bit different so it will largely depend on the situation and what you might be looking for. Do you have a scenario in mind now?

Hey Chris,

For a DSCR delayed financing there is quite a bit of flexibillity since it is a non-conforming loan. I think it comes down to how quickly you want the cash back and what use you would have for it. In our case we wouldn't have any value seasoning on DSCR so as soon as you do the repairs, we can potentially use that higher value to get you cash out. It could then possibly be easier to follow that up with a rate/term refi if/when rates drop and get back into a conventional loan (if that would work for you or if that fits your situational goals). It definitely depends on what you might be looking to do though whether that makes sense.

Hey Jessica,

DSCR can move quickly if everything lines up. If we might be able to help feel free to reach out.

Hey Rick!  Yes most lenders should still provide you that option.

Hey Faiz!  

The key would be how long you would have owned the property and then how much equity you have afterward. You could potentially refinance DSCR as long as the seasoning period has been met (varies lender to lender) and you have the minimum equity position. It wouldn't necessarily mean you have to put more down, but the repairs done on the property would hopefully get you to that threshold.

Hey Preeti!  There are a lot of great financing options available for those looking to househack while in college.  If you have questions about that side of things, feel free to reach out.

Fees in every state/municipality will vary, but let me comment based on my experience.  With that disclaimer out of the way I look at that in a few ways:

- Off the bat, your lender fees appear to be lsightly above average.  Although they wrap it all up into one fee, out flat fees are $395 underwriting and $395 processing with a $60 technology fee.  That probably didn't change for you though from your initial loan estimate and the difference isn't that great really.

- From my standards, your title fees are extraordinarily high.  For that loan amount, we typically see title fees sitting around $1,700-$1,800.  Note that because it is "a service you can shop for" there is no limit to a potential increase.  Compare what they quoted you for title fees initially and you may see a significant jump here.

- In Section H, I'm not familiar with what MISC charge could be $1,400.  Maybe just a different municipality, but I would ask for more detail if you don't already know what that is.

Although potentially high, to work through the differences compare your loan estimate and see what line items were added/changed.  Were you initially paying a point for your rate, or did you agree to that after the fact?  Generally speaking, a good rule of thumb is to expect your closing costs between 3%-5% excluding any points paid so even though they may be slightly higher than other lenders, they are still in that industry-wide range.

Hey Waylon! I'm with Jay, are you trying to find an all-in-one equity line construction loan? Based on your post, I would say you would be looking for a DSCR cash-out refinance and then use that to contract a builder. If you are looking for an investment property construction loan, you will probably be resorting to hard money lenders.

Hey Nick!  
I’m not sure if it would make sense, but would be happy to learn more about you and your situation to see if we could possibly help.  Our team has worked with seasonal/variable employees and so we have developed a system for calculating it that maybe could help at least point you in the right direction.  Feel free to reach out if you have any questions!