check this link out…hot off the presses!!!
https://www.efanniemae.com/sf/guides/ssg/2009annlenltr.jsp
see ann 09-02/date 2/06 - click on PDF to see announcement
Good to hear, however, the six month reserve requirement may be a tough hurdle for the investor with high PITI mortgages.
The other thing people are missing is no cash-out is available.
Does this mean your limited to 10 rental properties/mortgages? Or can you just go and get more mortgages from another lender?
Fannie Mae has a 4 financed property rule in place. They have recognized that experienced investors are needed to participate for the housing recovery to gain any momentum. Thus, Fannie Mae has promulgated a set of qualification requirements for investors who wish to acquire their fifth through tenth financed property.
Fannie Mae does not make loans. They purchase loans other banks and mortgage lenders originate. Lenders who sell their loans to Fannie Mae can now finance your fifth through tenth property (your financed primary residence counts as one financed property) if you meet Fannie Mae’s borrower qualifications. Does not matter where the first nine loans came from, the total number of financed properties can not exceed ten under the rule.
Ok, this is a good thing for me. I had 7 mortgages
on rental properties when they changed the rules
and I was fast on my way to owning 10 then BAM
they slammed the door.
I have been told once you get to 10 loans you can
get a “Blanket Commercial Mortgage” to cover all
10 (say $1 Million dollars or more) and start all over.
Maybe I will get some more feedback on this in an New
Topic.
OK, Listen having 6 months in Reserve is a GOOD thing, and
NO CASH OUT, come on guys… The old way of investing done
by newbies, and those who just winged it - or took out STATED
Loans, or those without any training or formal classses on Real
Estate Investing well those days are gone.
Now HOPEFULLY we are left with
seasoned investors, so we don’t get in this shape again.
I am looking for 2 or 3 good turn key cash flow properties
this week? Any suggestions?
Wallace,
If you already have seven financed rental properties, and if your primary residence is also financed, then you now have eight financed properties. You can only finance two more investment properties under Fannie Mae’s new rule, which will bring your total of financed properties to ten.
Commercial loans are not purchased by Fannie Mae, and don’t count as a financed property under Fannie’s rule. Instead of refinancing, why not just acquire your eleventh property with a commercial mortgage loan? Will be a lt cheaper in the long run. If you are going to have a 15 year amortization, a point or two highr interest rate, and a five year balloon, I would much rather have a small mortgage on just one property rather than a huge blanket mortgage on ten properties.
Wallace et al,
The problem I encountered with the “Blanket Loan” deal is that when you sell one of the properties, and pull it out from under the blanket, this just pays down the principal on that big mortgage. It doesn’t free up any cash for you to do the next deal with.
So I’m with you, Dave T, I would rather have 1 small loan just because I don’t like the bank dictating what I’m going to do with my equity. Maybe I just want to go to Paris and sip Cafe au Laits. But it’s MY money, not the banks.
Furnishedowner