Dallas-Fort Worth Real Estate Investor Club

Conventional Real Estate Financing

  • 14 Jan 2009 8:53 PM
    Quote
    Message # 83667
    Robin Carriger (Administrator)

    I want to continue to buy and rent property, but, since Fanny Mae and Freddy Mac reduced the limit on the number of loans I can have from 10 to 4, I have had trouble getting my usual 30-yr, fixed interest rate loans with good interest rates (i. e.  I'm already over the limit of 4 loans).

    I have found some lenders who will do loans with an interest rate from 8% to 8.5%, but that's at least a couple of points higher than I would like.

    It would be nice to know if there are any other sources of good loans out there.  Once I find (and close :-)  ) a 30-yr fixed loan that is better than 8%, I plan to post that wonderful experience right here.

    If any one has any recommendations, please post your comments here.  As a proactive measure, if you would like to discuss "Subject To," "Seller Financing," or other alternate strategies, I would too, but please create separate topics for those.  Thanks
  • 14 Jan 2009 9:12 PM
    Quote
    Reply # 83675 on 83667
    Vicki and Shawn Stone
    I don't know whether I can actually make a recommendation, as it were, but a lady at my office just bought a house with USDA (yes, USDA) financing. Said there were some peculiar restrictions, though -- not sure it would be all that great for an investor. Still, I guess it would be described as conventional.  I.e., it's not owner-finance, or subject-to.

    As for the 4-loan limit, wasn't there some talk in a Nubys meeting not long ago about using trusts or corporations to refinance loans and get them off your plate?  It's very possible I misunderstood that, but it's what I thought I understood.

    --Shawn
  • 15 Jan 2009 12:18 AM
    Quote
    Reply # 83745 on 83667
    Robin Carriger (Administrator)

    You're right.  There was some discussion about refinancing using a trust.  In the interim since those Nubys Group meetings, I still haven't found any one who can explain how to do that in sufficient detail.  It seems you need an attorney (for the trust part) as well as a somewhat flexible/knowledgable loan officer (for the money part) who each understand the process from their side.

    I've also talked with some commercial lenders.  The terms of the loans I discussed with those guys were fairly unattractive, so I've just kinda put them on the shelf as I've continued my search.
  • 09 Feb 2009 11:52 AM
    Quote
    Reply # 103146 on 83667
    Cindy Carriger (Administrator)

    For everyone's info...and soon it will be all over the place, but I just heard that the Fannie Mae restriction of # of loans went back up to 10 (from the current 4).  However, this is 10 investor loans total, not just those from Fannie Mae.  Great News!  Happy Investing!

    ~Cindy C.
  • 09 Feb 2009 1:24 PM
    Quote
    Reply # 103318 on 83667
    Deleted user
    Fannie Mae Rules are changing back to allow 10 properties, but the maximum LTV is less.

    https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0902.pdf
  • 04 Jun 2009 8:33 AM
    Quote
    Reply # 182456 on 83667
    Deleted user
    Just closed a deal with Texas Trust Credit Union that no one else would take.  Property was owned free and clear but only purchased about 7 months back and is currently a rental.  Every other lender I spoke with wanted to know what I paid for it ( Would only loan a percentage based on my actual costs) or I needed to wait the full year before they would loan based on the appraisal.  There was no issues with me owning multiple rental properties.  Their terms 6.5% fixed, 15 years, ammortized over 30 years with a balloon after 15 years.  They only charged 1 point for this.  I was able to walk away with around $7K and will cash flow $300 /mth.  Just need to make sure I prepay every year on principal to decrease balloon payment.
  • 05 Jun 2009 2:21 PM
    Quote
    Reply # 182883 on 83745
    colleen bryson
    Robin Carriger wrote:

    You're right.  There was some discussion about refinancing using a trust.  In the interim since those Nubys Group meetings, I still haven't found any one who can explain how to do that in sufficient detail.  It seems you need an attorney (for the trust part) as well as a somewhat flexible/knowledgable loan officer (for the money part) who each understand the process from their side.

    I've also talked with some commercial lenders.  The terms of the loans I discussed with those guys were fairly unattractive, so I've just kinda put them on the shelf as I've continued my search.


     

    I think you may find that when all is boiled down, weather trust or LLC or C-corp, the same problems remains. They will look to the holder (owner, trustee,CEO ect.) for responsibility. If that person is you and you already have 4 loans your in the same boat. That is the rule for corporations, I am not up on trust but I suspect it is the same.

    There are private mortgages. Yes they are usually a bit higher. That may be something you just have to live with. The only other thing that may work is to go in with a family member, have them hold the mortgage and you run the project. Check the legal on it.

    Colleen
Powered by Wild Apricot Membership Software