Investment Property Financing

TD Bank requires 25% down for investment properties and won’t allow the investment to be in an LLC, only in your own name.  Do all major banks (Bank of America, Wells Fargo, TD) require 25% down for investment properties and have that prohibition on LLC’s?  Has anyone had any particular good experience with a bank and/or an individual at a bank in arranging financing for an investment property? Ie..allow 20% down / LLC’s / no drama approval process / other tangible benefits. Thanks!

tylerderden1211

in Agents and Brokers 13 years and 4 months ago

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adam_dahill | 13 years and 4 months ago

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There is one program that offers a little better rate but it’s only available if the property being purchased is a Fannie Mae REO, you can then qualify for the Homepath product. It’s only if you are buying a foreclosed home that Fannie already owns and has taken back. Google Fannie Mae REO and it should take you to a search engine of homes that will qualify.

adam_dahill | 13 years and 4 months ago

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And thank you for being a great client totoro. It makes my life so much easier when my clients have their act together and get me everything I need in timely fashion. Dealing with lenders these days is like talking to a brick wall and extended turntimes make it even more difficult.

adam_dahill | 13 years and 4 months ago

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Yes you can do a 30yr fixed with 20% down on a condo with that sales price. The building would need to be a fannie mae warrantable condo. 70% sold to owner occupied, 51% with a waiver. We’ve had pretty good success with the waivers as long as the condo makes sense. Things to watch out for would be one entity owning more than 10% of the units, a lot of holdover renters if it’s a conversion etc….  Rates would be high 4% to low 5% range depending on pts or not as you have a lot of price adjustments at 80% About 4pts in price adjustments for LTV above 75% for condo, Inv at 80%, etc.. Rates would improve dramatically every 5% more you put down. You would need to close in your personal name and if need be deed transfer to LLC after closing. LCC will only protect you from liability not absolve you from mortgage obligations.

Townie | 13 years and 4 months ago

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Thanks Adam for a wonderfully quick and painless closing.  Can’t say enough good things about you and your fellow workers.  Happy Holidays and a prosperous new year!

tylerderden1211 | 13 years and 4 months ago

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Looking to finance a condo.  Purchase price between $290k and $350k.  One bedroom.  Don’t absolutely have to have a 30 year fixed but probably will go with one. Have run both numbers on a 30 year and 15 year fixed…15 yr only likely if 10 year treasury drops to ~1.5% next year.  FICO score is 750+.

adam_dahill | 13 years and 4 months ago

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Yes there are lenders that allow 20% down on INV property purchases. We need more details to determine if your scenario can qualify for 20% down though. What kind of property is it? 1-4 units? 5+ units? condo? coop? What’s the purchase price of this property? Do you have to have a 30yr fixed?  90% of residential banks will definitely have a problem with an LLC ownership. The major banks are in the Fannie Mae/Freddie Mac business and they don’t lend to LLC’s. You can go to a portfolio bank or you can quit claim the deed to the LLC after closing, but technically you are not suppoosed to do that and legally the bank can call the note due, but they rarely do if you are paying your mortgage on time.    -Adam Dahill WCS LENDING LLC adahill@wcslending.com nmls 66099

daveinbedstuy | 13 years and 4 months ago

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best to go through a mortgage broker when looking fo financing that devaites from the normal.  Adam Dahill is a good one.