My partner and I are investing in properties with nice cash flow. There are several we want to purchase. I was wondering how many mortgages can we get? What is the limit they set and if there are any that dont set a limit. We are getting the properties in new york and they are all good positive cash flow.
Thanks
I was wondering if you can get 10-20 mortgages thorughtout a period of a year or 2 or 3 years. rental income is there to support it. If you can, what banks will give them?
Thanks
The number of mortgages depends on the particular lender.
One of the biggest problems is reserves- reserves are money that that the lender requires you to have available after settlement. For most lenders on an investment property, they require 6 months PITI for reserves FOR EACH PROPERTY. That can be a problem unless you have a lot of assets and start aquiring a lot of properties.
dwj469,
How many mortgages can you have?
I dunno. When I had 4, the mortgage broker said one more was all they could do. When I had five, they found a way to get 5 more. Each mortgage is more expensive than the last, and each is a little harder to qualify for, but I recently closed numbers 14 & 15 and have 3 more pending. An old guy told me he had 30 at one time but cut back because it was too much work and he likes having fewer houses, but with no mortgages. I suspect you can get as many as you want to pay for, but they get more expensive as the quantity increases.
Good luck,
Ray
Each Lender has their limit of properties per client. It vary’s from as little as 2 to 6. This does not mean that you can’t have more than that, it just means that the particular lender will only do that many.
As long as you can continue to qualify for loans you can have as many as you want!
I’m hearing more and more (thru Realtors, etc.) that there is some sort of cap on Conforming Loans at 10…
Anyone else hearing that, too?
Keith
That’s right - the most you can have with a Freddie Mac or Fannie Mae underwritten mortgage is 10, including your personal residence if it’s a conforming mortgage.
thanks for the replies. What is a conforming loan mean? Thanks again.
It’s underwritten to meet Fannie Mae and Freddie Mac standards.
10 per Fannie or Freddie. Sure.
BUT
other nonconforming lenders may allow up to 10 depending on LTV and which core investors they are selling their loans to. So if you have enough moolah, and I have say 5 lenders after Fannie or Freddie, well then,… 50 maybe 60 properties is a possiblity. That would keep you busy. I’ve done it.
Lending hand is right. Fannie and Freddie max out at 10.
However, Subprime Lenders deal with investor’s. This means that as long as the deal is strong and they can sell it, they will take it.
Even if a particular Lender says that they can only do 2-3 initially, they will do 2-3 more after a couple of months. This allows them time to sell off the last batch of mortgages to the investor.
So nonconforming lender’s basically have no limit?
Non conforming lender’s have a limit.
However, there are numerous non conforming lender’s and each one’s limit is independent of the other.
As mentioned in previous posts, Fannie Mae and Freddie Mac max the number of mortgages to 10. With of course the exception, those lenders that will go above that limit. To answer your question: a conforming loan is referred to as “conforming” based on loan guidelines as well as the loan amount. Any loan under $359,650 is considered conforming (for a single family/1 unit), anything above that loan amount pushes you into the jumbo loan category. Unless of course you structure the deal so you have a first and second. Here are the various loan limits as of right now. By Jan. 2006 FNMA and FHLMC are going to announce the new conforming loan limit for single family which will be increased to $380k…Here is the rest of the info for max loan amounts considered conforming: 2 fam = $460,400 3 fam = $556,500 4 fam = $691,600 …Hope that helps!
Why not just buy all of your properties at once??? Set all the closing dates within a couple days from eachother and only do 2 loans per lender. As far as they will know at that point, you will only have whatever credit lines in your name that are currently on your credit report. It usually takes at least a month after closing for the loan to show up on your credit report…Its scandalous, but wouldnt it work??
Hmmm, not likely to happen. Finding all of your properties at once is not quite that easy…but of course if you’re willing to commit fraud (by deceiving the other lenders of the additional properties), burn all of your bridges with your mortgage broker (s), and watch your credit scores tumble due to the mass number mortgages that you just acquired then give it a shot! Really though, this is not even an option…
woops…well, i was just brainstorming… :-\
No problem…Sometimes you won’t find the answers you’re looking for until you ask the question or put it out there for discussion…
I wouldn’t worry about the number of properties that can be financed. That’s not an issue. Unlimited properties can be accomplished. You wont need to go subprime either. Suprime transactions have higher rates and generally require prepayment penalties. Make sure your working with a mortgage broker that knows investment financing.
Don’t worry about the number of properties that can be financed? Ben, I’m sure you are aware of Fannie Mae and Freddie Mac guidelines. So, then you are aware that MANY banks prime and subprime, strictly adhere to the 10 mortgage limit. Yes, subprime loans typically come with higher rates and often a prepayment penalty. However, I think that perhaps you read into the posts a bit too much. No one said the ONLY option is subprime, clearly any educated mortgage broker/LO knows that is not the case. In my post Oct. 5th I stated this: “As mentioned in previous posts, Fannie Mae and Freddie Mac max the number of mortgages to 10. With of course the exception, those lenders that will go above that limit”. Investing in real estate is a concept that ALL mortgage brokers/LO’s should be well aware of and have closed many deals in this area. It is important for readers to know the Fannie Mae and Freddie Mac limit of 10 mortgages, as well as the fact that yes, there are other options for those who are willing to do the research. But investor guidelines should not be discredited.