All Forum Posts by: Rebecca Wisner

all good info but you can not use an FHA loan to buy a rental property they only allow owner occupied so you would have to occupy. If you want to buy a rental that will not be owner occupied then conventional financing can be used. Typically if you are using your self directed retirement accounts lenders will loan 50% and 50% needs to come from the IRA or 401K. Conventional you can do with 15% down. Hope that helps

Hi Justin,

How long ago did you close and was the rehab costs run through escrow and on the final closing papers?

If you are just rolling the purchase price and rehab costs with less than 6 months seasoning then you would be able to get traditional financing at a decent rate. 7.5 seems really high. If you are trying to pull additional cash out without the seasoning then you are probably getting what we call non QM financing which is better than hard money but not as good as traditional.

Hope that helps.

Rebecca Wisner

Sr Loan Officer NMLS#77337

Premier Mortgage Resources

Jason, Unless you are doing a cash out refinance instead of a rate term refinance which isn't priced as well. 

Bob, Can you use a commercial lender on a single family residence or is it just 5 units+?

Yes but without the 6 months of seasoning you have to go off of acquisition cost not appraised value for traditional financing.

So I have listened to several podcasts and read about the BRRRR strategy and it is something I would like to pursue.

I am a traditional financing expert and have been originating mortgage loans for over 30 years and I understand how you can add the contractor to the closing statement and pay through escrow and then do a rate term refinance and get the funds back to pay off the existing loan and the construction costs. My question is, if you are a newer investor and your hard money lender wants you to put 10-20% down. How do you get that money back out on the refinance?

Thanks so much for your reply. I am seriously back peddling the deeper I go with my due diligence, thanks for reinforcing my instict that this is way too risky. I am not aware of 1st position fractionalized loans but I will check that out for sure. 

I met her at a Real Estate meetup, she started investing about a yr and a half ago and has done very well.

She wants me to do a Promissory note only for $30K at 15% interest for 3 months with no Deed.

Am I crazy to be doing this in this market?

I am reading that most gap funders get a share of profits and points.

Thanks this is fairly new to me.