All Forum Posts by: Rico Nasol

@Nicholas Krieg

They will typically ask for a signed lease so they can verify the rental income and they will count it towards income. They really want to know if the rent covers any debt service and expenses.

+1. Find a new lender. I moved to a new state a couple of times and most lenders only need confirmation that you and your wife will continue employment. I've also had employees of mine move and I confirmed that they would continue working. You shouldn't have any issues.

Are all of your rentals in the same city/area? If so, you can look at refinancing them into one note. There are pros and cons to that. Pros are you have one note to pay and you have a single rate to manage for a package of properties. The cons here are you are pretty much stuck with these properties for the long-term. If you want to pay one property off, you'd have to refinance the package and pull that one property out. Also, if you wanted to sell one or 2, you have the same issue of having to refi out the properties you want to sell. It all depends on what your long-term strategy looks like... there are more options, but that's just another option to consider.

Some banks typically do this for their commercial lending. They will give you 5-7 year (sometimes 10 year) terms on a 30 year amortization. They are mainly because a lot of commercial investors will typically refinance into a long-term loan after acquisition and stabilization. For my own portfolio, I prefer 25-30 year term portfolio loans which behave just like your conventional personal loans, but the rates are higher because they are for investment properties vs primary.

I know a few if you want to DM me.

It'll all depend on your debt to income ratio. That is what most lenders will look at. What is your ability to repay. If you care going conventional loans, as long as all of your debt combined ends up to be less than 41% of your monthly income, you should be ok. Of course this is just based on the little information you provided so your mileage may vary. All of your debts, rent, mortgages, etc. will be used in that calculation. There will be other factors of course like credit score, work history, etc. that lenders will look at as well.

@Jordan Gerkin you should definitely be able to find a commercial loan in the 80% LTV range.i just completed one last week. Let me know if you want to chat. I can help you find what you need.

@Quaid Cde Baca I would definitely go with a gov backed loan since this is your first. A duplex + converted garage should cover your loan and then some. Fortunately we had cash going into investing so we had some wiggle room. Be sure to understand what the ARV will be once you finish rehabbing that house hack. You'll likely want to refinance that thing (like you mentioned above) to get you into your next investment property. If you can keep your rehab costs down that'll help since to refi to a conventional loan, the most LTV you'll get is 80%. Some have even gone down to 75% LTV but if its a long-term buy and hold property, 80% is easy to find. I'm excited for you.

When we use our HELOC, we make sure that we can get all of our money back so we don't have to carry a balance. Our goal is to pay it off 6-7 months after we use it using the BRRRR strategy. We will typically buy at 65-70% ARV knowing we need to put in $20-30k into it. When we refi, we have a good idea of what it will appraise for so when we refi it in 6-7 months, we at least pay down what HELOC we've used. In our best deals, we actually refi it for more than what we have in it and we can now start to stack cash stores. With $120k, my approach would to have at least an ARV of $150k... $160k if you are being conservative. As long as you stay within your $120k budget, you should have a nice BRRRR on your hands.

Also... our approach and the way we buy, we are always buy and hold. We're playing the long game while we have other streams of income.

@Chase Taylor I would go with the latter option. Once you have the HELOC taken out, it might be tough to get the refi done since you will already have a 2nd on it. As long as you haven't closed, you can still back out and adjust your strategy.