What is the closing time for Rental Loans?
The closing time for Rental Loan is 2-3 weeks. We are a direct lender, so there is no difference between the closing time for of all our loans.
Do you require full appraisal?
Yes, a full appraisal will be required, including the interior.
Do you require income or assets verification?
We offer asset-based loans, so we don't ask for or verify your income or assets.
What are your closing fees?
There are fees associated with legal documentation; background and criminal reports; as well as servicing setup and wire fees. These fees usually are between $1,750 to $2,200.
Do you lend to LLCs?
Yes, we lend to LLCs.
Do you work with brokers?
Yes we do, we have a lot of broker-friendly programs.
What are seasoning requirements for Refinance?
6 months seasoning is required to use Market value. Prior to 6 months we can refinance based purchase price.
Do you have Prepayment Penalties?
You can chose no prepay penalties or 1-5 years Prepay Penalty term.
What are Prepay Penalties terms?
For 5yrs - 5/4/3/2/1; for 4yrs - 4/3/2/1, for 3yrs - 3/2/1; for 2yrs - 2/1; for 1yr - 1%
Do you require all units to be occupied?
SFR and 2 Units Properties have to be occupied. 3 and 4 units can have 1 unit vacant and 5-8 units can have 2 units vacant.
Do you require lease agreements for all units?
Rental agreements are required for all units with more than four months remaining on the lease.
Is it acceptable to have month-to-month leases?
Rental loans require longer-term rental leases to be in place. Rental loans can be for periods shorter than a year; however, month-to-month rent is not factored into DSCR calculations.
What documents do you require for Rental Loans?
- Personal information: two months of bank statements, Proof of experience (if applicable), Driver's License or other government ID, and SSN
- Property Information: Purchase agreement or HUD, Insurance, Title, Lease Agreements and Insurance
- LLCs Documents: Certificate of Formation, EIN, Operating Agreement, and LLC resolution
What if rental income exceeds the average market rent?
We will first order an appraisal to obtain market rent. We will then compare the average market rent with your rental income and use the lower value for DSCR calculations.
Which FICO score will you use if there are multiple borrowers?
If there are multiple borrowers with similar FICO scores, we will use the highest FICO score.
Do you require Bank Statements?
Yes, we require two months of bank statements to verify if borrowers have enough to cover the principal, interest, taxes, and insurance. Bank statements are to be either in the borrower’s name or the LLC we are lending to. Otherwise, proof of ownership will be required.
How many months of reserves do you require?
We require six months of PITI (principal, interest, taxes, and insurance) reserves.
What other reserve sources are allowed?
Life insurance or annuity at 100%, liquid stocks or bonds at 100%, 401k/IRA at 50%, Cashout at 50% (some restrictions may apply).
Property Management Fee?
If the borrower lives more than 100 miles away from the property, general market management fees will be applied for calculations of Debt yield and DSCR.