All Forum Posts by: Matt Toeneboehn

@Matt Toeneboehn sounds like you have 1 year to establish relationship with 2-3 each of: handymen, electrician, HVAC and plumbers.

Also, find a real estate agent that knows how to show rentals and do MoveIn & MoveOut evaluations for a fee. 

THen you can do everything remotely through them.

@Matt Toeneboehn with $25K to put down, I think you're going to have to use the VA loan. Conventional financing on a MF will require 25% which would limit you to a $100K purchase. $100K for a MF in pretty much any market is going to be in a rough area.

If you were one and done, without a doubt, the VA would be better. But if you plan to buy multiple properties over time, then I would keep the VA in my back pocket and go with the physician loan now..... if the rates were were not dramatically worse.

As far as not impacting DTI, I will leave it to a loan officer to answer but I don't see how it would not be on your credit report. When you mean privately held, you may mean that it is a portfolio loan for the lender and not resold in the open market - Fannie, Freddie, etc - but it would still be on your credit report.

Just so you know when you go to buy the second property, the lender will count all of your expenses and only credit you 75% of the rent. So if rent is $1000 and PITI is $1000, the lender will see it as a $250 a month debt obligation.

Hope that helps.

@Matt Toeneboehn- the physician loans vary from lender to lender ...often these are designed to 1) minimize down payment 2) be flexible with the employment start dates of the MD 3) be more flexible on large med school debt .......the main downside to the VA loan is the VA funding fee ( if applic) and also tying up the VA elig ....but I would say the VA option will still be a much better option to use

@Matt Toeneboehn

There is no better loan product out there for house hacking multi-family than the VA loan. Physician loan won't let you do 3 or 4 units, they may allow 2 units but the rates are going to be way worse and VA rates will always be the best.

The VA loan is best benefit one can have from being in the military...if used wisely. Ideally the first time the VA loan is used, it would be used to purchase a 2, 3 or 4 unit property to live in for a year and then move on to the next property. The VA loan is certainly far more superior than the FHA loan.

the market is very competitive in many cities and its the same story here in San Diego but you can still get VA offers accepted although not as easy these days. The last couple of multifamily deals I've done with VA loans has been off market properties where my buyer did not have to compete and got his VA offer accepted.

There are options where you have 2 detached units that live like single family homes and some properties that have a house up front and 2 or 3 units in the back of the property both scenarios would be decent options for your family. You certainly get the most out of the VA loan by house hacking when you purchase in these higher priced coastal markets.

Best of luck to you and your family on the move :)

Assuming the rates are relatively similar, use the physician loan now. 

There is only so much entitlement you have with a VA loan. You can have more than one VA loan at the same time as long as you have entitlement left. I am not a loan officer so I don't want to get into the math. Also, different regions of the country have different loan limits. It may be best to keep the entitlement intact for the larger purchase a year out.

If you are going with no downpayment, the funding fee increases for your second VA loan. (Under the current rules, if you put down 5% or more, the funding fee does not change for a 2nd VA loan.)

I don't know the markets where you will be buying this year (I do know the Northern Virginia market outside DC as that is where I practice.) Almost all are extremely competitive now. Most homes are getting multiple offers. In a multiple offer situation, some sellers are reluctant to work with VA loans. It is too complicated to get into here but mainly it has to do with appraisal requirements. Plus, conventional buyers can waive an appraisal but VA borrowers, by law, can not. The physician loan may be more appealing to a seller in today's market.

Last, while physician loans are popular and have been available with many lenders over the years, they come and go and terms change. VA will always be there.

So, without knowing specific circumstances, I would suggest using the physician loan now and keep the VA loan in reserve for future use.

Hope that helps. 

 This is slightly unrelated to your post but hopefully you find it useful. Are you a newly licensed physician? 

Secon, with your goal to invest in real estate have you considered the free to low cost housing options that are afforded to military personnel and physicians? You'd know more about what's available to military personnel. I can tell you as a RN there were facilities that gave free to low cost housing for working at their facility, usually due to travel assignments which also pay better. You already know how much in demand you are, so I brought that up as an option for you to stack more cash toward multiple investment properties.