All Forum Posts by: Luisa Trigo

Hello,
Our back up contract was unexpectedly accepted so the timing on everything shifted before we had everything lined up. Hence, we are about to close on a mortgage for an investment property and we are in the application process for a HELOC with a different lender. Our mortgage bank is now saying that we have to reduce the credit line of the heloc to stay within DTI guidelines. Will the HELOC also ask to reduce because we will have a mortgage by then? Is it best to address this with the heloc lender asap or close on the mortgage and then handle the heloc. What would be general advice when working with two lenders, two products, and the timing of everything? Is it best to be fully transparent or to keep conversations separate with each lender/product/timing?
We are using the heloc to complete the down payment and have rehab money. We are using the mortage to purchase the property.
We are starting out so new to financing sequencing. We're thrilled our back up contract was accepted just caught off guard with the financing timing not in place. Any insights appreciated.

@Blake Maloney
Hi, I just found your post. We're in a similar situation. How did your situation work out in the end?
We're under contract, working with a bank on the mortgage and a CU for the HELOC. Aiming to close on the mortgage first, then the heloc. Not sure how DTI will impact for how it will play out. Any insights appreciated. Thank you

 Alex, if you have contractors you would recommend after working with them on your project much appreciated. Looking at some multi families now and for a contractor. 

Quote from @Alex Bekeza:

Quote from @Luisa Trigo:

Quote from @Alex Bekeza:

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Saint Louis.

Purchase price: $157,000

I just purchased this 4 plex in the Gravois Park area to BRRRR! 2 units are currently leased with the other two in need of full reno. We've budgeted $15,000 per vacant unit to completely revamp. Appraiser gave us an ARV of $235,000. Once fully stabilized and leased this bad boy will have a DSCR north of 3.0 in a great area! At that point we'll do a refinance into a 30 year fixed loan.

What made you interested in investing in this type of deal?

Value Add Opportunity, Huge Cash Flow Potential, and rapidly improving area.

How did you find this deal and how did you negotiate it?

MLS

How did you finance this deal?

Hard Money

How did you add value to the deal?

Will completely reno both vacant units (new floors, paint, fixtures, vanities, etc).

What was the outcome?

TBD, will up date post in a few months.

 Hello @Alex Bekeza How did your 4 plex in Gravois Park go curious to learn more about that area. What is the tenant pool there and if you're not local where you able to work with a good contractor for that area?

 @Luisa Trigo It took much longer than anticipated but all is well!  I've made a lot of connections on the ground there from the clients I've worked for as their loan officer.  South City can certainly have rent delinquency issues so we have very strict tenant criteria.  That being said, we've begun leaning heavy into section 8 as well.  

 Alex,
Yes, I understand and section 8 may be the way to go for that area. Great that it's working out! 

@Jonathan Klemm

Hello,

Chiming in on this conversation and wondering @Jonathan Klemm if you have done seller financing for both the down payment and the remaining amount? Or just for one or the other? And if you have done an interest only payment period during construction/renovation period and then P+I once the property is stabilized with new tenants in?

We’re looking at a property in Missouri that needs updating, my husband is a builder we would do the work, would like to do seller financing for down payment remaining loan amount with interest only payments while we do the work. We have to get funds to do the work too.

Any experience and insights on this model appreciated.

Thank you

Quote from @Alex Bekeza:

Investment Info:

Small multi-family (2-4 units) buy & hold investment in Saint Louis.

Purchase price: $157,000

I just purchased this 4 plex in the Gravois Park area to BRRRR! 2 units are currently leased with the other two in need of full reno. We've budgeted $15,000 per vacant unit to completely revamp. Appraiser gave us an ARV of $235,000. Once fully stabilized and leased this bad boy will have a DSCR north of 3.0 in a great area! At that point we'll do a refinance into a 30 year fixed loan.

What made you interested in investing in this type of deal?

Value Add Opportunity, Huge Cash Flow Potential, and rapidly improving area.

How did you find this deal and how did you negotiate it?

MLS

How did you finance this deal?

Hard Money

How did you add value to the deal?

Will completely reno both vacant units (new floors, paint, fixtures, vanities, etc).

What was the outcome?

TBD, will up date post in a few months.

 Hello @Alex Bekeza How did your 4 plex in Gravois Park go curious to learn more about that area. What is the tenant pool there and if you're not local where you able to work with a good contractor for that area?

@John Michael I spoke to Together Credit Union they're in 48 states except Alaska and HI. They have an intro rate 2.99% first 12 months then variable. 10 yr draw period interest only payments. This is what I've found to be the best for St. Louis MO thus far. Wonder what they're offering in your area.

@John Michael Hello, where are you located and looking for HELOC? I'm in the same boat shopping around for a HELOC right locally in St. Louis MO. I've seen good options at First Bank and PNC. They're showing better terms than the local credit unions thus far.

Thank you for the replies and information.
Our interest in a HELOC is two fold: to improve our primary residence so we can rent it out and to use a portion towards a down payment on a four family. We're looking at HELOC options that offer the interest only option so we can refinance before we have to start making principal+interest monthly payments. Appreciate any replies based on this.

Hello,
I am looking for a HELOC, 10 year draw period, interest only, at a fixed rate.
All I am finding is variable rate OR fixed rate for a HE Loan repayment principal plus interest.
Aiming to use the HELOC to cover the down payment on a four family so want to have the option of interest only payment and a fixed rate. Any insights appreciated.
Thank you!