All Forum Posts by: Jeff Trevarthen

@Colleen Pelliccia lavin

 It depends on what your short term and long term goals are.   There's plenty of cash flowing property in California so you don't necessarily have to go too far!

Jeff

A smart seller would appreciate a higher rate of return in exchange for the seller financing.  And if you amortize the loan over 30 years, make a balloon payment or something to show that you have an exit strategy.  

Usually it's a 10 year draw period amortized over 30 years.  Mine is currently structured so that I pay interest only payments until that 10 year mark after which it becomes fully amortizing.  

FHA PMI no longer drops off after any time period. You have to refinance out of the FHA in order to get rid of it.

It really depends on your goals! What is your plan if you sell? Rents are also ridiculously high right now. Run the numbers, figure out a plan, and execute.  

You could probably pull out some of that equity and invest it in many other parts of the country that have much different circumstances than what we're currently experiencing in the Bay Area.

Good luck and let me know how I can help.

Non owner occupied properties and multi-unit properties always cost more money.  $500-$700 per appraisal is the going rate out here in San Jose.  As @Neil Aggarwal

  stated, $5000 in closing costs is not out of bounds.  You can usually ask for a higher interest rate and have the lender pay some of the closing costs, or you could roll the closing costs into the loan amount, or you could have it paid out of your cash proceeds.  On a loan amount that small, I'd opt for a slightly higher rate and have the lender pay the cost. It's going to make a difference of only a few dollars on the actual payment. 

@James De Silva

 Are you implying by "refinance" that you already have a loan on the property or did you purchase it all cash? Generally, if you have high scores and established trade lines, then you should be able to get financing.  Usually the income has to be at least 2 years. 

The best bet would be to try to increase your score.  Most banks that I work with require at least 620 and some are 640.   

Welcome to BP @Radhika M..  There is such a wealth of information as you already now.  If you need any help with financing or have any questions about the local market, please feel free to contact me.

All the best.

Jeff

I'd like to chime in here.  Most loan officers like the "low hanging fruit".  That is to say deals that aren't too complex in nature.  Back before the Dodd-Frank Act, I think you would have found more folks willing to get your deals done because they'd would be able to price the loan appropriately and be able to gain an appropriate income for working on the more complex deal.  With the strict "lender compensation" requirements, it may depend on the size (amount) of your loans.  In other words, if you have small loan amounts and lender compensation is capped, what's in it for the loan officer? 

Personally, I can see value in doing the smaller loans and doing a good job for you, because I understand this is a relationship business.  Doing the deal for you know could lead to referrals and more deals down the road. It's been my experience that 95% of loan officers don't have a clue that this is how you build your business and production.  They're in it for immediate compensation when the goal should be long term relationships which would in turn provide an annuity of income.