All Forum Posts by: Nick Velez

@Jordan Hall

If you go on facebook and type in Gainesville Fl, Bigger pockets investor meet up, it should pop up!

@Luis De Jesus

Hey Luis, I am actually from Ocala, I lived there most of my life!

I have heard that some people are crushing the returns on STR's near the new world equestrian center. I think the 1% rule overall in Florida is extremely hard to come by.

@William Arnold

Hey William, this is a lender we broker loans too. This product is no longer available from them with the most recent tightening in the Non-Qm market. They were one of my last lenders to offer 15% down.

@Bernard Joseph S. @Danny Jimenez

Correct, I meant as you shop around for different lenders, make sure they will lock your rate. There are a lot of DSCR lenders who will not lock you right now until you have the appraisal back or are clear to close. This is just asking for trouble in today's rate environment.

There is no lock and shopping on the Non-qm side that I know about. If there is, we need to add that lender to our roster lol.

@Danny Jimenez

DSCR loans are my favorite loans to work with but there are absolutely a lot of terrible lenders out there. As you shop around, make sure your lenders will actually lock your rate. When things get iffy in the non-qm space, the first things lenders like to do is suspend locking to hedge their risk (I have even heard of lenders unlocking borrower's). If any lenders have a history of doing this, I would steer clear. Make sure your lender also has a back up solution. If you have to have a DSCR of 1 and you come back at .9, you're dead in the water. Most brokers have access to plenty of lenders that will go no ratio in the event that the 1007 comes in low which is an important safety net.

Each lender is going to have varying guidelines based off their current appetite for risk. These guidelines are ever changing due to how crazy the market is and it's important to make sure the guidelines you are being told now are still in effect when you go get into contract a month later. For example, I was going to utilize a 15% down DSCR on a property not too long ago. The week that I planned on locking it up, our lender let me know that 15% down was disappearing the next day and if I didn't submit my loan same day, I would be out of luck. If I wasn't in constant communication with our lender's I would have never known the product was no longer going to be offered at this time. You can save yourself a lot of headache by following up to make sure the product you want is still available.

@Josh Green I highly second Josh Green and his ability to connect clients with great vendors! 

@Sean Starkey

DSCR lenders want the long term rents on the appraisal to be equal or higher than your PITI on the subject property, which is a DSCR of 1 or higher. If you have at least 1 year of experience, some DSCR lenders will let you use Airdna data instead of the long term rents.

@Sean Starkey

There are definitely DSCR brokers out there who can beat that. 2% origination is pretty common with DSCR loans but you should be able to find rates in the high 7's with no points assuming you have good credit. If your property does not have a DSCR ratio above 1 then expect to be in the 8's for sure. There are a lot of properties out there that will struggle to ratio with long term rents but would absolutely kill it as a STR. It is up to you if you are fine not having a cash flowing back up option but you know what they say, date the rate and marry the house!

@Brian G.

Hey Brian, that seems a little steep. I have seen quite a few 2nd home quotes lately and they end up around 7.125 with around 0.5 points for the rate.

This is with a 740+ score and 10% down. 

@Sean Peabody

DSCR loans are likely the easiest way to go about this if the property is already rented and cash flows. Keep in mind that while they are non-qm loans, a majority of the time they still show up on your credit report. While you are vesting in the LLC, you are still a personal guarantor for the mortgage. Some lenders will promise you that their loans don't show up on your credit report and it is entirely possible that they don't report them, but I have seen more times than not that they eventually get reported.