Income Fourplex - Down payment? - Posted by Frank

Posted by richard on August 02, 2001 at 21:58:21:

hello jim, is there a possiblity that i could get an email of of that excel spreadsheet also? thanking you in advance…richard

Income Fourplex - Down payment? - Posted by Frank

Posted by Frank on July 05, 2001 at 24:09:50:

I am looking to buy my first fourplex as a rental investment. I have been talking to some lenders. One lender told me that Fannie Mae has a new requirement for 30% down for those with less than 2 years of experience in rental business. They require two schedule E to prove it.
30% will really kill my plan. Could anyone verify this? I am planning to put down 10%.

Re: Income Fourplex - Down payment? - Posted by JjHx

Posted by JjHx on July 05, 2001 at 16:47:50:

I closed on a 4 unit a couple weeks ago with 10% down no carryback and a 3 unit today with 10% down and a carryback. Try using a mortgage broker as they do the ‘shopping’ for you to find the lenders.

Another way you can obtain financing is to call a lender to request the ratios they are held to (debt coverage, cash on cash, etc). If the transaction falls within the ratios you can position the transaction to the bank from a cash flow perspective.

Another way to lower the amount you need to bring to the closing table is to have the seller pay points. Sorry this isn’t the most eloquent response but I am pressed for time and I just wanted to let you know that it is possible. If you would like to discuss anything further let me know.

Re: Income Fourplex - Down payment? - Posted by Frank

Posted by Frank on July 05, 2001 at 17:16:06:

JjHx:

Thank you very much for your response. Finally, one mortgage broker called me with the following quotes:

1st loan - 80%
1 point loan origination fee
0 discount point
30 year fixed at 8.675%

2nd loan - 10%
30 year fixed at 9.675%.

Total closing cost: $3668 (including the original fee).
Do you think this is a good deal?

Thanks again for your response.

Frank

Re: Income Fourplex - Down payment? - Posted by JjHx

Posted by JjHx on July 06, 2001 at 09:31:02:

I would need contracted purchase price, income, and expenses to determine if the debt would be servicable (i dont think thats spelled correctly), ROI (cash on cash return) etc.

Also, I would continue to shop around to determine if you have the best rates and closing costs available. You already have a verbal commitment from one broker so it wouldn’t hurt. Where is the property located? I have an excel spreadsheet that would help in determining if this is a good deal…let me know if you would like me to forward to you.

Good luck!
Jim