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All Forum Posts by: Matthew Wolk

Matthew Wolk has started 1 posts and replied 77 times.

Post: Cash-out equity loan for house paid-in-full

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Lisa Sluss:

I have a fixer-upper that I own outright.  I’m 80% finished on the rehab.  I need cash to carry me to the finish line.  A cash-out equity loan of $75000 with no pre-payment penalty would be perfect.  A hard money lender would be ideal, however they seem to be focused on fix and flip loans.  Any suggestions?  (I purchased for $225k  with ERV of $450k.)


 Lisa,

You are correct that you will have to go hard money. In order to get a cash out refi OR a HELOC on the property, it would have to be insurable. When you say 80% of the rehab is done, what is left? If you could not get an AS IS appraisal or Home Insurance on the property you would have to go hard money. I can provide some referrals if you would like, please message me if you have any other questions!

Post: Qualifying for an FHA loan

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Erica Ho:
Quote from @Matthew Wolk:
Quote from @Erica Ho:

Hello,

I am a first time home buyer and was thinking of buying an out of state rental property first. The second home I would buy would be my primary residence in a much more expensive area like NYC where I would be house hacking. Would I still qualify for a FHA loan on that primary residence since it's technically my second property? Trying to see what is the best approach to get favorable first time home owner benefits.


 Erica,

Congratulations on starting your path to home ownership! You would be able to still get an FHA loan in NY in this situation. Is your income able to support two mortgages though? If you bought an investment property, you could use 75% of that income. If you file that income on your tax returns the year you buy it, you could then use 100% of that income to count towards your debt to income ratio. I would just be sure you debt to income ratio from the investment property would not impact your ability to get the FHA loan in NY. Please let me know if you have any other questions.


Thank you for the info Matthew! What counts as income from the property? Would that be the cash flow I get or the home value?


If you buy an investment property out of state you could use some of the income to offset the mortgage. This would be more cash flow you would not get income from appreciation. I am not sure how much you make a year but most people can't qualify for conventional, FHA or VA loan with two mortgages on their debt to income ratio but if you can count rental income on the investment, it would help offset. You could then get an FHA loan in your home state of NY. That would have to be your primary residence.

Post: Qualifying for an FHA loan

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Kenny Smith:

@Erica Ho

Another thing to note is you can only have 1 FHA loan at any one time. If you buy this next one with an FHA loan, just know you'll need to re-fi out of that one before you can take out another one.

Best of luck!


 False

Post: Confusing question on home equity...

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Buck Dabill:

I have purchased 6 properties in the last few years and held them as long term rentals. I purchase the properties and fix them up using a line of credit and then refinance them paying off the credit line. I bought a property for 45k and fixed it up for 100k, so i am into it for 145k. I have only worked with one bank on all of my deals. This Bank is saying I do not have enough equity left in the property to refinance a mortgage for 145K and get my 100k line of credit back to use on the next project. The property is worth 300k. They are saying because the property is a rental they only use a cap rate to define its worth not what it could sell for so they are only giving it a worth of 109k. Do all banks value single family properties this way? I should add it is currently renting at 1,550. I have 6 properties that have a total value of 960k if I were to sell them, but they are only saying they are worth 688k in their book. They will lend up to 75% of the 688k which is 516k. My most pressing issue is a property I just bought for 256k that I need 50k in order to fix up so I can turn it into my first STR. I would appreciate any advice you might be willing to give on my situation.


 Buck, I shot you a message, I can offer you some options on this. 

Post: Qualifying for an FHA loan

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Erica Ho:

Hello,

I am a first time home buyer and was thinking of buying an out of state rental property first. The second home I would buy would be my primary residence in a much more expensive area like NYC where I would be house hacking. Would I still qualify for a FHA loan on that primary residence since it's technically my second property? Trying to see what is the best approach to get favorable first time home owner benefits.


 Erica,

Congratulations on starting your path to home ownership! You would be able to still get an FHA loan in NY in this situation. Is your income able to support two mortgages though? If you bought an investment property, you could use 75% of that income. If you file that income on your tax returns the year you buy it, you could then use 100% of that income to count towards your debt to income ratio. I would just be sure you debt to income ratio from the investment property would not impact your ability to get the FHA loan in NY. Please let me know if you have any other questions.

Quote from @Jeffrey Guarino:
Quote from @Matthew Wolk:

No Non QM lender would do this, minimum is 75K loan amount.


Hey Matthew, the loan amount I proposed was $92k, above the minimum you've provided. The question I'm asking here is, is there anything I can do to get this property valued based on NOI and not comps? I'm willing to buy more properties cash (SFH or duplex or triplex) and blanket them as a portfolio if necessary. Do you know if this will help me receive an NOI based valuation?

Thank you

Jeff


 Jeff,

My apologies for the oversight. I do these DSCR cash outs all the time. Basically you will be able to get up to 75% of your money out of the house so your calculation is correct. Then as long as your mortgage payment is less than your rent ($1,000) you will be good to go. You will not need any income documents for this and you can do a cash out based off the rent you are receiving. An appraiser will not only value the home but also complete a market rent analysis. The lender will use which ever is lower, the market rent analysis or the amount of rent you are currently getting (if you have tenants in there for at least 3 months, I know lenders that will let you use the actual amount on the lease over the market rent analysis. So yes, you can use NOI on this. When did you buy the property? You would just need to wait 6 months from whenever you closed on the home.

Post: Quadplex DSCR FHA Conventional

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27

In order to go DSCR you have to own a primary. So if you sell your primary and then rent, that could be an issue. You MIGHT be able to get an exception at some lender but with no primary, you couldn't go DSCR most likely. You might have issues with conventional depending on if your income can support all the mortgages you currently have (I am not sure how much your mortgages or rents are on the other properties). You most likely will then have to go 25% down on the multi if you DSCR it. If you can go FHA into a quad and your income supports it, that would be best bet.

No Non QM lender would do this, minimum is 75K loan amount.

Post: Suggestions on creative financing

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Jon A.:
Quote from @Matthew Wolk:
Quote from @Jon A.:
Quote from @Matthew Wolk:

I could get you funding on this. DSCR this and you don't need to worry about income, you could use the rental income dictated by an appraiser OR I have lenders that will allow you to use AIRBNB income. Please let me know if you want to talk!


You do DSCR loans with 5% down?


What is the homes value?  My apologies, I misread this and thought you had at least 15% down. 


I'm not the original poster. Just a surprised onlooker. In my experience, DSCR is max 75% ltv, at least on 2-4 unit properties. You do 85% ltv?


 I am not seeing the OP mention this as a 2-4 family but I may be mistaken

Post: Suggestions on creative financing

Matthew WolkPosted
  • Lender
  • Tampa, FL
  • Posts 79
  • Votes 27
Quote from @Jon A.:
Quote from @Matthew Wolk:

I could get you funding on this. DSCR this and you don't need to worry about income, you could use the rental income dictated by an appraiser OR I have lenders that will allow you to use AIRBNB income. Please let me know if you want to talk!


You do DSCR loans with 5% down?


What is the homes value?  My apologies, I misread this and thought you had at least 15% down.