All Forum Posts by: Mark Munson

 I sent you a message. We can connect to set up a call. I'd be happy to answer any questions. 

Hi @Daniel Coley O'Grady

It is neither good nor bad, but there are a lot of things I would look out for. Firstly, I always ask them if they are direct to seller. If not, there could be numerous chains of the contract which can convolute things. I only want two chains at most, but preferably direct to seller. You also have to know whether it will be an assignment or a double closing. The latter will typically cost you more, as there are two sets of closing costs and the front side will pass their cost on to you, so you pay twice essentially. The reality is you will at some point buy from a wholesaler if you try and scale this business. Another thing to note is that a lot of lenders don't allow wholesale transactions or will only finance a portion of any assignment fee, so make sure you speak with your lender about that. I co-own a lending firm/brokerage and a wholesale company, so I know both arenas well. Feel free to reach out if you need any advice. Best of luck with your investments!

 BP typically frowns upon solicitation, so I avoid listing anything here. Feel free to message me.  

Hi @Tiffany Henning

There are lenders that do, but they typically cap the loan to value at 65%. If they are AirBnB properties, that is a bit easier to get a higher LTV.

Hi @Raquel Brown

As another mentioned, I would make sure you are allowed a partial release if you are doing a portfolio loan. Secondly, I would shop lenders using the Find a Lender function on BP. Don't take soft quotes or quotes just lazily typed out in the body of an email, get actual loan summaries with all the costs. There is typically not a huge difference between a 5/1 ARM and a fixed rate, so I would look for the latter. If I were you, I would also want a 3/2/1 prepayment penalty structure, if you can get it. You need to ask when they lock your rate as well. Lastly, when they did your appraisals, I assume they determined the market rent via a 1007? If that is the case, are they using your actual rental rates to calculate the DSCR or the figures the appraiser determined? If the latter, there are lenders out there that will use your actual rental rates as long as you have lease agreements, 2 months of rental receipts, and the actual rent is within 20% variance of the market rents on the appraisal. Worst case scenario, if you wanted to go with another lender, you can have the appraisal transferred, typically as long as it was ordered through an Appraisal Management Company. Feel free to reach out if you need any advice.

Hey @Roy Jenkins

As long as you have good credit, typically above 720, being a first time investor won't be overly punitive. Avoid lenders that want to escrow your payments at closing, this increases your cash to close drastically and, in my opinion, is not the best structure even for new investors. You'll want to get at least 85% of the purchase price + 100% of the rehab costs, and this is very doable with good credit, regardless of your experience. Rate should not exceed 12.5% at most and more commonly about 11.75%. Make sure the lender gives you what is called "Non-Dutch Interest" on the rehab portion, that means you do not pay interest on the rehab funds until you use them. That will keep your holding costs lower. Lastly, look into joining the local Real Estate Investor Association in Greenville. It is a good group of like minded investors and I think the value you would gain there would be very beneficial as you get started. 

Hi @Jason Boring

I would recommend joining your local real estate investor association as well. You can absolutely find deals, you just need to connect with more wholesalers or agents for off-market opportunities. I would focus on flipping to build more capital; however, if the deal allows you to use the BRRRR method then I would refinance into a DSCR loan after the rehab is complete. Doing both flips and BRRRRs, if possible, would prevent you from locking up too much liquidity into a deal or numerous deals, thus allowing you to continue to scale. Feel free to reach out if you need any advice.

Hi @Jonathan Krauser

I'm in Orlando as well. I suggest using the find a lender tab on BP. Get multiple quotes and always ask when they will lock your rate. Underwriting processes vary as well, so make sure you are not trading a nightmare underwriting process for a fractionally lower rate. Best of luck!

Hi @Becky Hoffman

As others have said, the typical minimum is 600 sqft, but there are certainly lenders out there doing less. Also, you can seek an exception from most DSCR lenders and they get approved at a high rate, it will just come with an increased origination fee (usually .5% for exceptions) or a interest rate add on.

Hi @Tom Thomson

I would use the Find a Lender tab here on BP. There are plenty of lenders that will do blanket loans and at 75-80% LTV. Just make sure they have a partial release clause if you want to sell one in the future. Also, ask the lender what the payoff amount would be if you sell one, usually it is 110-120% of the prorated portion of the loan. Feel free to connect if you need any advice.