All Forum Posts by: Nate Herndon

Good morning @Brian Kempler - we work with a few dozen national private lenders and still don't have anyone allowing RON. I have closed some loans for clients located in China, Spain, and Japan thus far in 2024 and they all utilized embassy or apostille notary. 

Power of attorney is not permitted, but I did have one lender who blessed off on a corporate resolution for a stateside entity member to have signing authority for the business. That seemed to accomplish the same intent as POA, however, would require the signor to be an entity member (as opposed to an assistant of yours or something).

@Usha Nanthini I do have some programs I have used for foreign national clients at lower leverage, but may work for your situation. Here are some aspects of those programs.

o 65% LTV for purchase
o 60% LTV for cash-out refi
o 12 months PITI reserves required
o 1.20 DSCR minimum (vs. 1.10 DSCR for U.S. citizen or permanent resident)
o 7.65% 30-year fixed for 60% LTV cash-out

Hi Paula, I do have a DSCR lender who can assist with a limited recourse loan that will close in the name of a self-directed IRA. I have been able to do this for both purchases and cash-out refinances on multiple deals for clients of mine. I would be happy to assist and answer further questions if you have any.

Typically your max loan-to-value for a cash-out refinance will be 75-80% LTV, but this specialized program will limit you to 70% LTV.

I have had the "limited recourse" language vetted by attorneys representing our clients. It passed muster upon close inspection from their entity formation team. As @Dmitriy Fomichenko mentioned, you cannot personally guaranty the loan and the limited recourse aspect navigates that requirement.

Hi Brian, fellow broker here but on the lending side. Would love to help your clients out with residential, multifamily and commercial lending, while seeing what we can refer your way on the insurance side!

What do you feel like you are doing really well these days as an insurance broker?

Yeah, I’d be happy to connect and discuss. Will shoot you a quick message. 

 Hi Jordan, good on you for searching around and doing your homework. I believe it is more common practice for your local bank’s commercial programs to only offer 5-year terms on 25 year ams. That’s what I see here in Missouri too.

For the couple dozen national private lenders that I utilize for clients, they are all 30-year fixed terms. I don’t see a huge issue with a 5-year term right now as most folks are planning to refi in 2-5 years at a lower rate anyway. It’s really that the 25-year am constrains your DSCR more than a 30-year am.

Local banks may also want to see a 1.15-1.25 minimum DSCR, whereas I am only using programs with a 1.00-1.10 DSCR floor. 

Hi @Sam Tright, I'd be happy to help. The minimum value my client's properties need to meet is $75,000. The minimum loan amount is $50,000.

Anything valuing lower than $75,000 will need to be bundled with another property (or two) in order to hit a $75,000 minimum loan amount on a different program. Those rates are about 1.50% - 2.00% higher than what we would be looking at if we can stay at $75k or greater on value.

All programs are 30-year fixed, with base rates for properties under $100k starting at 7.375%, and the average 75% LTV cash-out refi going for 7.75-8.00% (depending on credit).

Hi Josh - all 1-4 unit residential deals in Indy so far (though we also do 5+ unit MFR and commercial). I've had the chance to help as a lending partner in fix-and-flips, BRRRR projects, and turn-key purchases for clients in Indianapolis.

From what I have seen from the financing side, rents are strong for relatively inexpensive properties. I know mid-term rentals are their own beast, but I had one client whose SFR BRRRR we refinanced that had the following numbers:

o ARV: $130,000 (appraised value)
o Market Rent: $950/month (per appraisal)
o Mid-term rents: $2,600/month (actual)

Hi @Venkata Soma, congrats on acquiring a property in the Milwaukee area! My clients there have done a really excellent job of producing cash-flowing properties, and there is a lot of growth in that area. I am sure that this house will appreciate really nicely over time.

Hopefully the spring market will heat up in your area and that will also help provide some excellent sales comps to boost your value. 

Here are some example figures that you could expect (based on today's 5-year treasury rate) for your refinance. These loan programs take your good credit, the property value, and the property income into consideration for what size loan you can get.

As for your rehab loan, I think that sounds like it is pretty in-line with what I see for the two dozen programs we utilize. 10.5% to 12% with interest on drawn funds only is where I try to peg most client deals.

Hi @Emanuel Manien, how do you mean "no liquid to invest according to banks"? 

No matter what, if this is your first investment property deal, you will have to have some "skin in the game" with anywhere from a 10% to 25% down payment, plus closing costs and required reserves.