All Forum Posts by: Michael Glist

Some banks will allow it and some will not allow it to be in an LLC. The alternative option is to take ownership as an individual and then doing a quit claim deed after closing thus putting it into your LLC name. But be careful as some lenders will occasionally check for stuff like that and if they find out may call the balance due.

I would say your best option would be to offer a 20-25% owner carry on the purchase of the home. This will allow someone to come in and purchase the property from you and get a hard money loan for the acquisition as well as the rehab and they would be able to use your 20-25% owner carry as the down payment needed to satisfy the hard money lender. I think this would be the best options that way you are not out a ton of cash and are still getting paid upfront and have another lender backing you in the event that it does default. 

A property that requires the property to be owner occupied mixed with a loan from a non licensed lender sounds like a potential disaster to me. You will definitely want to have a real estate attorney involved.

But if you do decide to go through with it, my question would be why are you offering better rates, terms and less points if you are potentially the only option they have to acquire the property?

There are lenders that do stated income for rental properties. They will weigh heavily on the property performance and cash flow as opposed to your personal DTI. This allows you to get a property rent it and the qualify based on the rental income as opposed to all of your personal obligations. This would be the way to go because most will also only look at the property you are purchasing/refinancing and not your whole portfolio. This helps with the "Cash Reserves" as most actual banks or mortgage lenders will require 3 months reserves of PITI for EACH property you own which can add up quickly.

I would say it depends on your time frame. With a refinance it will typically take a little longer to get completed, where as with a LOC it is a quicker process to get funds into your account. So if you have time to wait then refinance if you are looking at a property that you want to move on asap then the LOC would be the best option. You can always take the LOC and then refinance it after thus rolling in the LOC into the refinance as well.

Are you looking to go direct to a Fannie Mae/Freddie Mac lender or does that not matter to you and you just want to get the refi done ASAP?

Best deal I would say get a HELOC, if you cannot get that then I would say refinance the Multi-family property with the SFR refinance as the last option. Although you will get more cash out and a better rate on the SFR the process can take a lot longer and be tougher to qualify for.

I think a personal loan if you can get one large enough to complete the rehab would be the best of these options as that will have less affect on your scores. The thing you will want to watch out for if you do one of the other two options is if it does affect your score how much of an affect will it have and will this potentially push you out of qualifying for a loan when refinancing. I see it all the time where people will use the whole LOC or CC limit and then it pushed their scores down too low that we cannot get them refinanced.

Welcome. I am also in Colorado (Born and Raised). If you ever have any questions feel free to reach out. 

Best of luck on your new endeavor.

I think the resources you use would vary greatly on which route you want to take. If you want to be a private lender the rules and processes will vary greatly on where you lend and how you want to structure your deals. If you want to me a HML then you will need to figure out how you want to set up your business and also abide by state rules as well as each investors requirements. If you have any questions I would be happy to answer them for you.