All Forum Posts by: Paul Zofsak

Another question, so if I go with another lender the only thing that they would be able to offer me, due to regulations and standard practices, would be a better interest rate and origination fee? As of now I am looking at about $6700 in origination and settlement fees for the refi on a $99k loan. Thoughts...

Refi will be a conventional loan. The HML was done at an LTV of 70% which just covered the purchase price; closing costs and repairs were all done out of pocket since the appraisal came in about $14K lower than estimated. I was hoping that a new appraisal would get a higher value and I would see some cash back at refi closing to cover my out of pocket expenses, but since I have been in the house less than 6 months that won't be the case.

Are there other options? An LTV of 80% would put me where I need to be, but, once again that would involve cash back at closing which isn't going to happen with a conventional loan as far as I have been told.

Just so we are all clear, it sounds like some might not be, the 75% LTV that I am financing in the refi covers purchase price, all my repairs, all closing costs, and would have left me with $8k leftover at the end of the day. However since I have not had the six month seasoning period I can only walk away from the closing table with 2% of (purchase price or ARV, I don't remember which) or $2K, whichever is less. This was something I had not known about, and expecting to walk away with $8K and now only taking $2k was quite a shock to me. This is my first HML/refi deal so you live and you learn, and I'll take this knowledge with me to my next deal. Thank you all for your feedback.

For those interested below are my numbers

Purchase price, $91K

ARV, $130k

Estimated repairs, $4K

Actual repairs, $8K

Cash out of pocket at HML closing, $14K (including first years insurance and $4k mitigation fee to listing agent's firm to negotiate with lender for short sale)

Thank you Dana, I have only had the hard money loan for about two weeks, have completed my repairs, and do not meet the six month cash out requirement. That explains everything then; lesson learned.

I recently purchased a SFH, did the hard money, did the rehab, and am ready to refinance. Taking into consideration the LTV of 75% and all the other factors I was expecting about $8K back from the refinance. I found out today that I since I have not had the loan for more than six months the most I can walk away with from the refi is 2% or $2K whichever is less. Is this a Texas thing, Fannie Mae Freddie Mac, etc? Has anyone else run into this?

Welcome, to BP. Mehran is right, Houston is really hot right now, definitely a seller's market at the moment.

I was told that it would be going in the HUD statement, does that mean I can include it in the financing or is it out of pocket at that point?

The price of the home is $95k

Thanks J Scott. I still have two questions, does $4k sound like an appropriate amount and can it be rolled into the financing, say like part of the closing costs?

I am dealing with a listing agent locally that handles mostly short sales, one of her fees that is paid by the buyer is a $4k loss mitigation fee. I am still new to investing and even newer to dealing with short sales; and I am dealing directly with the listing agent. My question is, is this normal and acceptable or is the agent "passing the buck" by having someone else negotiate with the lender and passing the fee onto the buyer and still taking their 3%, or in my case 6%? I can understand the advantages of having someone negotiate on your behalf, but is $4k about right, and should the buyer be paying for this? Also, is there anyway to roll this fee into the financing; as of yet the agent is telling me it is paid out of pocket outside the financing?

Thanks, Paul