All Forum Posts by: Chris Sanders
Chris Sanders has started 0 posts and replied 23 times.
Post: Could LLC harm the chance of getting mortgage?
- Real Estate Consultant
- Forest Park, IL
- Posts 60
- Votes 3
Ryan,
I am a mortgage broker and I've learned a lot about this in the last few months. I have a borrower who owns a investment property in the US Virgin Islands. He holds every single property he owns in a separate LLC for tax/legal/liability issues, and he's a Harvard CPA.
However, this presents MANY problems when you try and refinance or purchase. Nearly every mortgage loan is sold on the secondary market. So Lender A will fund your mortgage loan and then sell it to large institutional investors. Well these investors will not purchase loans that close in the name of an LLC, which is why nearly every lender can't do it.
To get a mortgage that will close in an LLC, you have to find a "Portfolio Investor/Lender". These are lenders who DO NOT sell their mortgages on the secondary market. These lenders are typically banks.
In my borrower's case, he's going to close in his name and then transfer back into the LLC. Now technically, if the lender found out he did that they could call the loan due. But they obviously won't find out as long as he's making his payments. The kicker is the transfer taxes. Since he's transfering ownership from the LLC to himself, he's subject to the tax from the county/territory.
So while there are many benefits to keeping it in the LLC, when it comes to refinancing it can be a real hassle.
Hope that helps...
Post: No Doc/ARV...Does It Exist?
- Real Estate Consultant
- Forest Park, IL
- Posts 60
- Votes 3
WHYFOR,
You can get that deal all day long but it's obviously hard money. These other brokers saying it can't be done are thinking of conventional lenders. Your credit worthiness will play a part but your income typically won't. These are hard equity lenders. They don't necessarily care about your income. Besides, you're financing your carrying costs anyway.
Go to Liquidbrick.com. He's a guy out of New York. He's just one of many lenders I know will do it...
Chris
Post: Financing new development w/ equity
- Real Estate Consultant
- Forest Park, IL
- Posts 60
- Votes 3
If you're going to take money out, I wouldn't go above 95%. Just because you have an appraisal telling you it's worth $700K doesn't mean that's what it will sell for. I would definitely leave 5% wiggle room in the loan. You don't want to be upside on this...
My 2cents
Chris