All Forum Posts by: Michelle Phimmasone

We are purchasing a beach condo STR purposes. Our broker had offered us these loan options:

20% down at 8.5% interest, $65000 down, $1999 monthly

25% down at 7.5% interest, $81500 down, $1704 monthly

We wanted to keep as much cash in the bank as possible so we went with the 20% down loan. They started working on it last month with a closing date of July 25. Just yesterday broker lets me know that the monthly isn't meeting the DSCR ratio and is short by around $49. He asked if we could do 23% down...that would be an additional $9750 cash upfront downpayment. I asked if buying just one point (cost maybe be $2600) to lower interest rate to 8.25% would be enough to meet the ratio. Also asked if we did a higher down like 25%, would we be offered a lower interest rate like before. He responded that he would check the costs of buying down the interest rate. Im feeling uneasy, with being told that we'd need more downpayment last minute but at the higher interest rate doesn't seem fair? If we had known earlier we would have taken the other option. Is there anything else we can ask, or no other options but to buy points or pay the additional $10K down? 

We are purchasing a beach condo STR purposes. Our broker had offered us these loan options:

20% down at 8.5% interest, $65000 down, $1999 monthly

25% down at 7.5% interest, $81500 down, $1704 monthly

We wanted to keep as much cash in the bank as possible so we went with the 20% down loan. They started working on it last month with a closing date of July 25. Just yesterday broker lets me know that the monthly isn't meeting the DSCR ratio and is short by around $49. He asked if we could do 23% down...that would be an additional $9750 cash upfront downpayment. I asked if buying just one point (cost maybe be $2600) to lower interest rate to 8.25% would be enough to meet the ratio. Also asked if we did a higher down like 25%, would we be offered a lower interest rate like before. He responded that he would check the costs of buying down the interest rate. Im feeling uneasy, with being told that we'd need more downpayment last minute but at the higher interest rate doesn't seem fair? If we had known earlier we would have taken the other option. Is there anything else we can ask or is buying down points all we can do

We would've had to do a a much higher interest rate and broker said would've had to pay more as well. I didn't understand either why it couldn't be extended with the same terms, they weren't telling us much. The broker for sure could've given us the loan details earlier 

So maybe I'm just venting and sad because we lost our property and our $7500 earnest money because our closing disclosure didnt come in until an hour before the end of closing day.W had an offer accepted last month for an investment property out of state. We were getting a DSCR loan and everyone was working hard to get it closed within 30 days. There were a few delays, like the appraiser had to redo the numbers in order for it to qualify for the 1:1 debt service ratio. Also the property under appraised, it was about $24,000 lower than contract/asking price, the appraiser took inflation into account and raised the value so that it was $8000 less than asking price.

We were scheduled to close Tuesday, April 25. Not sure of full details because my hubby was the one communicating with them, but the broker had already had to extend our interest rate twice due to the appraisal delays so it was going to expire the day of closing. However by that day, we still hadn't gotten the closing disclosures, had not seen anything on the final numbers, cost of loan, closing costs, amount needed to close, except for what we had gotten on the loan estimate 20 days prior but the broker said most of those numbers were made up. He said the title lady was still working on the disclosures, he hadnt seen it either, they would send it to us asap. They were on Eastern time, we're on Pacific and it was already 4pn their time  I wasn't home, had to do school pickups, my hubby tells me that they finally emailed the disclosures. 

We could only very briefly look at them, like minutes, and the cash to close was  thousands higher than expected even with the earnest money factored in. The financed amount was less than what was originally on the estimate, so the difference in the numbers meant we needed to pay more upfront. We didn't have enough cash to close. My hubby said he was getting calls that we needed to sign the disclosures right away, make the appointment for the notary, there was less than an hour left before the end of the closing day. Because of not having enough time to look over the disclosures, not having enough cash to close nor the time to figure out how to get more money, and the interest rate expiring, my husband had no choice but to back out of the purchase. So we ended up losing the property and earnest money, broker said if we wanted to go forward it'd be a whole new interest rate, all new papers to redo, and rates are a lot higher now. I just don't understand why they had to put our backs up to the wall like that after all the work and effort put in, I know you're supposed to get the disclosures 3 days prior. 

Hi Bob, I'd like to know who your private lender is because I just got quoted 7% with 2 points bought, 30 yr fixed on a DSCR loan to buy a condo for STR. We have sufficient funds for down, good assets, ($150K cash, over $500K equity, etc) and our end we see over 700 credit score but lender is saying they're pulling 664. Low credit is due to no credit history because we have paid everything off, no credit cards, etc so I guess that's bad. Still even with a higher score we'd probably get 6.5%.

Hey we got quoted just now for our DSCR..
6.9999%, 2.xx points at about $7600, 3-year prepayment penalty, about $17,000 closing costs upfront. Ive been told that upfront closing costs and prepayment penalties are standard with DSCR. Gonna try to get second opinions and other estimates, because it seems high...on our $408,000 purchase, we're having to pay $106,000 cash to close ($17,000 closing costs, $7600 points fee, and $81,000 down). It's crazy...hoping we can find something better

Start with small claims court and bring a lawsuit to them to pay their outstanding rent balance. You’re not evicting them but trying to collect money that is owed to you. In CA, small claims court is open and I was able to file a lawsuit to collect $9800 of overdue rent. I was given a court date, and I was supposed to inform the tenants that they were being sued. However they left before then so I cancelled the lawsuit

Thanks! Yes and we have a Facebook forum for this area for homes available for rent/people looking to rent. Most say that there is so much competition, it’s impossible to find a home and that they’re gone immediately after being listed, with multiple applications 30+. One post mentioned there was a home for rent for $3400 but after a couple of days was raised to $3900 because of multiple applicants. I am trying to figure out how to post in the group to feel out some actual rent prices people are currently paying for comparable sized home as ours. But to not sound like the homeowner 😅

Have been doing research and I know actual rent here is higher than the average data that is showing. Have a 5 bedroom house, plus huge bonus room that can be 6th bedroom, with 4 car garage and 3000 sq ft home. We just got it back from non-paying tenants and we spent 2 months renovating it (cuz could only work on days off). But we lost a lot of money from previous tenants, have had to put a ton of money back into it for renovations. It’s a great house in a good area in Menifee, near the college and close to middle and elementary schools. Would like to charge over $3000/month rent. But not sure how much. 

The only places I can check for comparison is other listings but 4+ bedroom homes available are very few. 3 bedrooms rent for about $2500. Just trying to price right the first time, and a competitive price but also we definitely feel our home is worth that. We renovated the heck out of it-brand new carpet, new porcelain tile and laminate flooring downstairs, epoxied the garage floor, new countertops, sink, pull down faucet, glass backsplash, new paint entire house, all new baseboards, added crown molding, and artificial turf and hard scaping front and back yard. Someday we’d want to add tankless water heater and Quiet Cool.

It’s a highly competitive area, with low supply and had the highest growth in rent increases. So am struggling a bit to know exactly how much rent to charge

Have been doing research and I know actual rent here is higher than the average data that is showing. Have a 5 bedroom house, plus huge bonus room that can be 6th bedroom, with 4 car garage and 3000 sq ft home. We just got it back from non-paying tenants who haven’t paid since before last Thanksgiving and spent 2 months renovating it (cuz could only work on days off). But we lost a lot of money from previous tenants, have had to put a ton of money back into it for renovations. It’s a great house in a good area in Menifee, near the college and close to middle and elementary schools.

Would like to charge over $3000/month rent. But not sure how much. The only places I can check for comparison is other listings but 4+ bedroom homes available are very few. 3 bedrooms rent for about $2500. Just trying to price right the first time, and a competitive price but also we definitely feel our home is worth that. We renovated the heck out of it-brand new carpet, new porcelain tile and laminate flooring downstairs, epoxied the garage floor, new countertops, sink, pull down faucet, glass backsplash, new paint entire house, all new baseboards, added crown molding, and artificial turf and hard scaping front and back yard. Someday we’d want to add tankless water heater and Quiet Cool. 

It’s a highly competitive area with low supply and had the highest increases in rent. So am struggling a bit to figure out how much to charge