All Forum Posts by: Nick Belsky

@Arron Paulino

Ouch! That sounds really high for a C/O refi. I am doing similar numbers at 3.6-3.75% par rates (no points) in Texas. Is the property in an LLC or something? I don't lend in CA, but know plenty of LOs that can probably get you a much better rate.

Let me know and I will send you some info.

Nick

@Shyam Panchal

@Bruce Lynn has hit the nail on the head. I wouldn't terminate based on these conditions, but I also do the work on 95% of my own repairs and remodels, so I may be a bit bias. Welcome to the world of REI!

Nick

@Mac T.

So everything you've described here is well within the limits of getting a conventional loan except occupancy.  As @Matt Devincenzo pointed out, no loans for investment MH.  I have lenders who will lend in Colorado that do single, double, and triple wides.. heck, they even do Tiny Homes and Shipping Container homes, but there are many restrictions.  Occupancy is the only thing you've mentioned that they won't lend on.  As a second home, you'd need to live in it for at least 2 months of the year, you free to rent out the remainder.

Nick

@Jonathan Gordon

I think @Grant Schroeder is hitting the nail on the head here. Look at creating good debt and not tying up all your cash into this. You can use DSCR or Asset Depletion based loans to get in a property with as little at 20% down based on your credit worthiness. Why pay cash and tie it all up? Use your cash for the down payment and finance the rest. Your rental income will need to cover the cost of your loan (Principal and Interest) each month with insurances, taxes, and whatever recurring expenses you decide to work in. Use Somebody Else's Money to pay the bank! Once you get the equity built up in it, Cash-out Refi and pull your down payment back out with interest earned on your investment. Make sure your rents are covering the new refi loan amounts as well. Then it is infinite return on investment. Ohhhh!!! I get excited just thinking about it!

Nick

I have to agree with @Wayne Brooks.  Your lender should've caught that one when verifying income in the pre-approval process.  Bummer.

If you live in it for at least 2 months of the year and have a primary residence already, you could call it a second home.  Renting it out the rest of the time would be perfectly acceptable to most lenders.  Just document everything and do what you say you are going to do.  

Nick Belsky

That's a tough spot.  I am a mortgage broker.  None of my lenders would touch you as a 1099 or Self Employed borrower without at least 1+ year of consistency.  You may be able to qualify if you mixed your W2 history in with the 1099 but that's a stretch.  I won't say no one out there will do it, but you've drastically limited your options.

Nick Belsky

Good stuff here.  I am a residential wholesale broker and don't do commercial.  Look at it this way, you'd fill out one application.  We do all the leg work and shopping around for you to find the best deal that fits your profile.  As was pointed out, basically free labor.  My business is ran with lender paid fees, so the borrowers doesn't directly pay me.  I get comped by the lender who in return re-coups some of my expense via interest rate to the borrower.  For example, a lender paid rate quote may be 3.25% versus a borrower paid fee quote at 2.50%.  Borrower paid will be on the CD.  Different brokers have different comps rates, but you will likely find that most will charge between 2-5%.  Wholesale brokers will be on the lower end, usually.

This is getting really nitty gritty in the weeds.  Ultimately, you are paying the broker over time with a higher interest rate to the lender or directly at closing.  Either way, a wholesale broker will almost always be lower costs than a traditional bank.

In the end, it all depends what your time is worth to you and how serious you are about getting one of the better deals out there.

Nick

With a projected inflation rate of 5% just being announced and a government that seems to think printing free money is ok, I doubt you will see interest rates staying steady for 2 years.  However, how high will they go?  Who's to say. The reality is anything at or under 4% is still a really good rate compared to previous decades.  Right now, they are undulating back and forth little by little, trending slightly upward. 

Gregg, I do C/O and HELOC financing in Texas. I don't know your exact borrower profile, but I did just quote a C/O on a 20 YR Amortized with 65% LTV (they didn't want to pull up to the full 80%), 680 FICO at 2.875%. My HELOCs are in the mid to high 3's. Lots of factors go into C/O Refi pricing, but good rates are still out there.

Nick

Hi Mike!

There are investment programs out there for first time investors, but you will find 80% LTV is pretty much a standard. You can check out a few lenders who may be able to set you up with lender near you. Sprout Mortgage or Angel Oak may be good places to start.

Nick