All Forum Posts by: Nate Herndon

@Troy Smith might be worth having a local agent take a look at your comps with a CMA and then weigh out whether your 'spring market' will bring better sales comps, or if the sales from the past 6 months will get you the value that you are looking for.

Here's a quick go-by for seasoning requirements for much of the investment property lending world. There is a 'no seasoning' program that I utilize for the fastest BRRRR clients, but your rate will be slightly better (0.25-0.375%) if you hold out for closing on a refinance after 90 days.

• Delayed Purchase, no Rehab completed
• 0-6 Months
• Up to 80% of purchase price
  
  
• Cash-Out Refinance, no Rehab completed
• 6+ Months
• Up to 75% of appraised value
  
  
• Cash-out refi, Rehab completed
• 0-3 Months (no seasoning requirement)
• 75% of appraised value
• Good rates
  
  
• Cash-out refi, Rehab completed
• 3-6 Months
• 75% of appraised value
• Best rates

 You bet - just sent a quick DM your way.

Good morning, Joel - 

What you are describing is a very common practice on the private lending side of the financing industry. Whether it be a fix-and-flip loan or a 30-year fixed DSCR loan, nearly all of the clients that I work with will opt for closing in the name of an LLC.

As you may know, closing in the name of an LLC prevents the loan from reporting on your personal credit as a tradeline (unless you default on the loan). I have investor clients with 40-50 loans that they have completed with me and not a one is reporting as a mortgage on their credit. Additionally, they've avoided 40-50 hard credit inquiries populating on their credit as a result of the soft credit inquiry that we utilize for DSCR loans.

If DSCR loans are a new thing to you, I would recommend checking out some articles here on Bigger Pockets or giving me a call to learn more. Always happy to discuss the ins and outs. DSCR loans underwrite to the income of the property, and do not require your personal income, taxes, debt-to-income ratio, etc.

Of the 1,100+ loans that our team closed last year, I want to say that only 1% to 2% of those were closed in a borrower's personal name.So, it is pretty irregular for us to process an investment property loan under a personal name.

Clients usually opt for closing in their personal name if they simply do not have an LLC established yet.

@Erick Pena I have a lot of clients that I work with on BRRRR deals in Jackson, both purchase-rehab and DSCR refinance. Would be happy to connect you with one of them for a phone call.

Feel free to call or email any time.

Hi Kris - Toledo is a really popular BRRRR location for my clients. Some DSCR programs require 6-month seasoning, but my favorites have a 90-day seasoning or 'no seasoning' requirement to refinance based on the new appraised value. Here's a look at the programs that my clients utilize the most just to give you a feel for what is out there in the marketplace.

Hi Kathy. @Jason Wray has some opinions that are his to have as one of those "FDIC Bank or Credit Union" loan officers himself. If there is anything at all that you'd like to discuss about a scenario or how our team advocates for our clients, you can reach out to me directly or @Greg Downey (our company president).

I love where I work and love what I do. I've been able to close over 400 deals for my clients in the past few years, and we are constantly working with the same clients who trust us repeatedly. We were actually named the 4th Best Place to Work in America (small employer) {https://bestcompaniesgroup.com/americas-best-workplaces-awar...}.

DM sent 

Hey Daniel, here is what that would look like on a program I utilize regularly for clients. This particular example is quoted for an investor with excellent credit. Feel free to reach out with any questions.

As a note to the admin, this might be better suited for the Broker/Lender portion of the forum. 

 @Nicholas L. may know something I don't, but I see this question a lot without a ton of traction gained. I suspect that any HELOC programs that are offered on investment properties are actually classifying it as a personal home or second home. A bank might be more flexible on something like that if their traditional loan volume is down.

What I can say is that of the institutional private lenders that I work with, I've only seen two HELOC programs offered and those were both nixed in 2023. One was a 12-month loan that collected all of your interest payments upfront, and the other was only offering it for luxury properties. Both were capped at a 70% combined LTV (CLTV) - so you still had to leave 30% equity in the property between your primary mortgage and the HELOC.

If you are looking for a way to access equity from a private lender, a cash-out refinance is still the way to go. Those are offered in the 75-80% LTV range from the DSCR programs that I utilize for clients. I totally understand the downside of that if you currently have a really excellent rate. If you do find a HELOC for an investment property, it will likely be through a bank who is simply in the mood to be more flexible right now.

Hey @Ryan Leach! Great question to start looking into early. As @Brandon Croucierand @Jake Baker have mentioned before me, the 80% LTV will be at a higher rate. To give you an idea, here's an example of where a couple of programs would be at that I use regularly for clients.