All Forum Posts by: Tamara Deering

This was explained in the previous answers but I'm going to simplify it for you:

If you own the home outright then a seller finance option would not affect your credit score and depending on how you structure it, the additional income may help your borrowing ability.

If you have an existing mortgage on your home, you will need to see whether there is a due on sale clause that will be triggered when you sell the home, you will need to investigate the mortgage wrap clauses that apply in your state.  If the buyer makes the payments on time your credit will not be affected, however, since you are still the owner of the mortgage any late payments or defaults will be tied to your credit score.

Rent options, subject to and owner finance are all non-traditional financing types and as such you will need to have the contract written by an attorney.  The title company can still close the transaction but an attorney will have to draw up the documents.

Good luck.

When I first got my license I met with 4 local brokers.  I made my decision based on the office, the broker, my potential co-workers and the amount of available floor time.  Since I was new to the area and didn't have a big sphere of influence, floor time was the only way I was going to get any leads.  

Good luck to you.

Yes, you can buy residential property with a commercial loan. Commercial just references that the properties are used for a business purpose vs. a consumer loan which is what you would get for your personal residence. The LTV allowed on a commercial loan is usually between 65 and 80% depending on the product and your credit score and the interest rates are a bit higher. Your fees may be higher with a commercial loan as well. This is where a mortgage originator can help you, they can evaluate the programs they have available and come up with the best product for your situation.

@Bridger L Logan

Typically you can't use hard money loans on owner occupied properties, you will be looking for a conventional loan.

You will need to check the rules for financing for both VA and FHA, typically 1-4 units are considered single family homes and will qualify for consumer mortgages, over 5 units and you get into multi-family and require different financing. In my opinion, it's not the size of the property that should concern you but the ability to get financing. If you have funding in place then go for it. Best of luck to you.

On cash out refis in the hard money space I'm seeing between 65 and 70% so I think your option is good. Also, if you do find an 85% option it may trigger PMI.

Have you been taking your depreciation?  It might be time to consider selling this investment (1031 exchange) to a new property to maximize your tax advantage and gain cash flow but as @Theresa Harris said it all depends on your goals.   I would recommend talking with a CPA and determining the best action for you to take to align with your goals.

You are at the point where you should start investigating your commercial loan options.

There are options out there, commercial loans, asset based loans, seller finance, etc.  The access to down payment funds will be more of a factor than your debt to income on a commercial loan.

Seems fairly standard, make sure that if you are using a broker his fees are included these can be 1 to 3% of the loan amount.