Need to refinance 5 multi-family properties. All 100% LTV

Is there any chance that I can refinance 100% LTV mortgages that I currently have for 5 multi-family properties. These are all 3-family properties that I acquired within the last 7 months. They are all 100% loans. I’m getting ready to lease them out and I’d like to try and lower the rates a little. All I can find are 95% LTV deals. Does anybody know of any companies doing 100% loans on investment properties? Any help or suggestions would be appreciated. Thanks.

100% financing requires a 720 score, full doc…,may be able to get cash out up to $50k…will veriify that later this afternoon when I get back to my office and confirm here.

Did you buy them under value? Is there any equity? If so you can do a no cash out against the new value.

100% does require a 720 and full doc and chances are at that LTV you won’t improve the rate much unless you’re refinancing a hard money loan.

If they were hard money deals I would guess that his LTV would not be close to 100%.

Thanks for the responses. They are all 100% LTV. Very little equity. I also have 10 other investment properties that I own. I’m only looking to refinance the 5 multi-families that I acquired within the last 7 months. The rates on these properties range from 9.75% to 10.25% interest only for the first 5 years. If I can lower the rates, I can probably break even with the income and expenses on these properties. Let me know if there’s anything you can do. Feel free to PM me if necessary. Thanks again.

at 100% LTV those rates are not that out of line especially with interest only. are they straight 100% loans with MI or without MI?

The lenders that would allow the rate/term refi limit investor to having 10 fincanced properties. In additiona, you have to have owned at least 50% of your properties at least 2 years.

I checked on my other 100% source and it’s only available on 1 unit properties. It does allow for cash out up to 100%, max financed properties is 10, 3 with them, and no property ownership restriction.

Seems that neither of these will work for you but as previously mentioned, your terms are pretty decent for 100%.

Thanks again for all the responses. There is no mortgage insurance on these loans. I wasn’t sure if these rates were in line or not. It appears I will need to wait about 1.5 years before I can begin to look at refinancing. I hope to have these converted into condos by then.

If I sell them as condos, will most lenders allow partial releases of lien? I anticipate that each of the units will be sold separately at different time frames. Do I need to check with my lenders now to see what they require?

Burn,

You would need to check with your city zoning committee before you do anything. From the way you phrased your original posting I am guessing that these five units are financed all in one loan per unit (not three loans per unit). So you will have to apply with the city for new legal addresses for most of the condos (you already have three original legal addresses for the current properties). So before you call the lender I would call the city and ask them about the changes you want to make and see what they have to say. Also, being that you are converting the apartments into condos you would be wise to partner with a lender who will help you with the end financing for your borrowers. Condo conversions are not too difficult to get financed, but they are not the easiest thing to do either. Hope this helps.

You might want to post some of the current I/Rs you have to determine if there is any significant mileage in this endeavor…

Regards,

Scott Miller

Regarding the condo conversions, I am partnering with a lawyer and architect to make sure we are in compliance with the city requirements. We don’t anticipate there will be a problem. We just have to make sure we make the proper filings and obtain the approvals. My lawyer has a lot of experience preparing and filing condo docs and feels we should be OK.

I just want to make sure my lenders don’t give me a hard time when I seek a partial release when I sell each unit. At the time of sale, there will be a specific deed/title for each unit. I just don’t know how lenders view partial releases. I would think they would not turn away an opportunity to have part of the original loan paid. I guess I would then have to refinance the remaining security interest they have in the property.

Any thoughts or opinions on this are certainly welcome. Thanks.

Condo conversions were all the rage 2-3 years ago in my neck of the woods (New England)—when the market turned, a great deal of these units are now being converted back to rental properties…

When affordability becomes an issue for some, the historical trend is that rental properties benefit (people need to live somewhere—when they can’t afford to buy, then continue to rent)—make sure your market analysis in your area accounts for this.

Regards,

Scott Miller

Appreciate all the great feedback. We will probably be renting these properties for 1-2 years and then see how the market plays out. If condos are in demand, we’ll convert and try to make some money. If not, we’ll continue to rent and I’ll be looking to refinance.