Fiancing For Around The 4 Mortgage Rule

Comments(8)

• 
  d_random9th February, 2009

  There have been a lot of discussions about this subject lately.
  
  Here are a few threads with the topic:
  http://www.thecreativeinvestor.com/ViewTopic65135-24.html
  http://www.thecreativeinvestor.com/ViewTopic64444-18.html

• 
  NewKidInTown39th February, 2009

  Fannie Mae has just relaxed the financed property rule. They will now allow between 5 and 10 financed properties, but there are certain requirements that have to be met before an investor with four or more financed properties can get the next loan.
  
  The borrower must have at least 720 credit score. No late pays in the prior 12 months. No bankruptcy or foreclosure in the past seven years. The borrower must have a cash (or cash equivalent) reserve equal to six months PITI+HOA for each financed investment property owned.
  
  In my case, a six month reserve for each property would put my reserves in the mid five figure range. About five times more than I have ever needed, but those are the new rules.

• 
  d_random9th February, 2009

  Good to know Newkid. Are the requirements the same for owner occupied investment properties?
  Does 401K qualify for cash equivalent reserve?
  
  
  Quote:
  On 2009-02-09 13:58, NewKidInTown3 wrote:
  Fannie Mae has just relaxed the financed property rule. They will now allow between 5 and 10 financed properties, but there are certain requirements that have to be met before an investor with four or more financed properties can get the next loan.
  
  The borrower must have at least 720 credit score. No late pays in the prior 12 months. No bankruptcy or foreclosure in the past seven years. The borrower must have a cash (or cash equivalent) reserve equal to six months PITI+HOA for each financed investment property owned.
  
  In my case, a six month reserve for each property would put my reserves in the mid five figure range. About five times more than I have ever needed, but those are the new rules.
  [ Edited by d_random on Date 02/09/2009 ]

• 
  bargain769th February, 2009

  I heard Fannie May raised their lending limit from 4 properties to 10 properties, if you qualify:
  
  https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0902.pdf
  [addsig]

• 
  d_random9th February, 2009

  Thank you Newkid.

• 
  moriley11th February, 2009

  You can use 401k funds for down payment, since they are your funds / assets. If you are taking a loan from the 401k, then the payment will need to be added to your debt for ratios. By lender guidelines.

• 
  d_random11th February, 2009

  Thank you Moriley!
  What I was mostly concern with was cash (or cash equivalent) reserve equal to six months PITI+HOA for each financed investment property owned. Could I use the 401K as "cash equivalent"?
  
  
  
  Quote:
  On 2009-02-11 10:58, moriley wrote:
  You can use 401k funds for down payment, since they are your funds / assets. If you are taking a loan from the 401k, then the payment will need to be added to your debt for ratios. By lender guidelines.

• 
  cjmazur10th February, 2009

  watch out for out of country tax issues / money laundrying.
  
  Check is a CA entity need a license in TX.[ Edited by cjmazur on Date 02/10/2009 ]