Posted by Paul Macdonald on February 22, 2001 at 20:52:39:
The folks you spoke with are talking Freddie Mac pre-automation. With an LP approval (FreddieMac automated underwriting)or a DU/DO (FannieMae) you can get up to 90% LTV investor for single family (sometimes duplex as well)units. 70% to 80% LTV for tri- and four-plex’s.
100% LTV NOO with a 75% first and 25% second (this is NOT a Fannie/Freddie product). Anything with a lower LTV is possible.
About your credit, it must be good enough period. The problem is that every single mortgage program has different underwriting criteria… therefore some programs will allow a 620 score… and some won’t touch you if you don’t have a 720 or higher score.
One of the things I cannot emphasize enough is get a basic understanding of financing. And every, a word worth repeating EVERY non-conforming lender has their own criteria. And will sometimes bend their own rules. Therefore, any deal is theoretically possible… but face it, there are some deals in reality that flat out cannot be done. But you don’t know what they are. Easily 80 to 90% of the ones that some lazy, vanilla deal only company rep. says cannot be done are cake-walks if you have the right sources.
My sad story is when I was 24 I worked for the Post Office. I went into a small local bank and said I wanted to buy a house. The VIP told me that $3000 down was not enough to buy a house. That until I saved 20% down (for an owner occ. in 1980 when the average price of a house in my area was about 50k) I’d never own. The man actually sneered at me. It wasn’t until I went into the money business as a salesman that I learned how badly I’d been mislead. For 10 years I believed that hoser and rented when I could have owned.
The moral I’m hoping to convey is don’t take no for an answer. If it is one of those 1 out of 10 deals that cannot be done you’ll at least get a great education while knocking on doors. All you need is one yes to make your day. I had one hughly non-vanilla deal that I must have received over 70 no’s on before I got a yes. From that property I’ve received over $1,500 positive cash flow per month for years.
Find a good source.
Wow. I just reread what I’ve written. Somebody get me off this soapbox.