No Proof of Income Needed - DSCR Loans - YouTube

my name is suzet enzyme present a TDR mortgage and real estate group in

downtown Oakland and I'm always looking for creative solutions to to finance

puzzles because that's what lending is and in a lot of cases it's a puzzle and

I am a solver I'm here with Heather Fox at home express lending she's what's

called a wholesale rep and she's someone that assist me in loan origination so

Heather tell us a little bit about what you do and who you work for

absolutely so like like you said I'm I'm an account executive and I deal with

brokers on the wholesale side we are a non-qm company we specialize in people

who have credit events self-employed borrowers investors which leads me to

our DSCR program that you wanted to talk about today right

so Heather most people don't know what a non-qm loan is is that like is that like

one of those crazy subprime loans like back in the day or how would you explain

an on cue of one well there's a lot more skin in the game versus back in the day

we don't do 8020 under percent there's a lot more regulations today than there

was that prior to 2007 but it does it is geared for people who maybe can't

qualify on tax returns or going full talk we do have options that are bank

statements and it's just basically a noncom alone as a non-qualified mortgage

non qualified means that you don't qualify through Fannie Freddie FHA the

traditional traditional mortgage channel like VA so yeah so I'm doing it alone

right now and hopefully I'll be closing it in a week or two and I call it an ESR

but it's a DSCR and I say that right DSCR and basically it's a supercool loan

I didn't have to put anything on the loan application about my borrowers job

because he he doesn't really have well he does but he doesn't make money

traditionally like a lot of people don't make money traditionally so this loan is

alone where it's the property that's the star the property is the qualifying

factor he tells a little bit about how it works

what the loan application looks like yeah so this is for experienced

investors we also have programs for people who are first-time investors and

we go off of the lease agreements so for a refinance we're gonna go off of the

lease agreement we're gonna give them a hundred percent of the lease agreement

and how we come up with the DFC are as we take the lease agreement amount a

hundred percent of it let's say let's say the lease agreement is $2,000 $3,000

$3,000 and then we divide it by the piti to let's say on this particular one the

total taxes are like 17 the principal interest tax insurance piti is $1700

that's the total that's the refinance and let's just say this borrower's doing

a cash out refinance up to 75 percent loan to value and it's $1,700 does that

automatically qualify someone so if you have $1,700 and a piti and and it's

$2,000 your debt service coverage ratio is over so you absolutely qualify you

have an over one to one ratio okay okay now when you have it when you have a

loan and you have someone that is less than meaning that their rents don't

cover their principal and interest tax and insurance then you're gonna have a

lower DSCR so if the okay so the payment is twenty one hundred so if the payments

2,100 but the lease agreement is mm that's a

deficit of $100 how would you how would you do that you would just divide it and

so we what you do so let's let's just do it so they can see so for example if you

have your lease is 2000 okay and then you're gonna divide it by 2100 okay okay

I'm not very good at math I know I'm in finance but hey isn't Heather cute you

guys think she's so cute we have a 95% d SDR and we have different hits for that

so as the DSCR goes down you're gonna get hit to the rate and it's gonna have

restrictions on your LTV as far as what you guys can like okay that might show

you yeah so I didn't know I actually didn't know that I thought I had to do

under the lease agreement I didn't know that you could actually go over a little

bit meaning meaning if the lease was $2,000 but the payment was 2,100 you

could still do this loan and so does this loan require but this isn't a weird

loan right because you don't put any income on the loan application and you

don't provide any income or asset any income documents like no taxes no job no

pay stub well we do put so you have to fill out yeah you have to fill out your

1003 and you do have to put some sort of position whether they're an owner of

something you do but you just don't put what they actually make you don't put

anything about income on there okay and then obviously you you put the subject

and where they're living okay we know that it's an investment property right

just the standard stuff but but we want a clear picture of their schedule of

real estate okay really I mean it's so simple it's an on-trend loan so you

don't have to nanny can they have like 50 properties or like how does it work

if they have a bunch of properties well obviously you're gonna do the schedule

real estate but we're gonna do the test based on the be subject property so do

you yet the other we're not looking at their other rental so let's say I have

an investment has twenty properties he doesn't have to provide mortgage

statements and lease agreements on all of his schedule real estate huh so he he

does we do require them to have lease

agreements on all of their other real estate but we're only doing that yes

they are off the subject see one thing that I noticed in this new non-qm land

whereas before we we may not have had to go to the extent of all that

documentation but you're still giddy you're still providing some neat I mean

you're still having to go in and provide documentation but like most traditional

loans you don't have to show income documents and so you can get like can

you get ninety percent cash oh no absolutely not

the math don't we do is eighty percent on a purchase rate and term and then for

cash out the maps that you can do is seventy five percent so I didn't know

you could do this song okay so and this is only for non owner

there's only but not only for non owner so you could do a non owner purchase to

eighty percent if the property cash flows basically yes you're absolutely

correct I didn't know you can job purchase just ISM to let me tell you on

a purchase obviously there's not gonna be a renter in there right so I'm glad

we're gonna go off of the 1004 D which is a rest survey from the appraiser and

we're gonna take a hundred percent of whatever the appraiser states on and you

do you want to get in did you want to sent to the peanut gallery

we're doing a live say hi Alex Alex Diaz president of statewide bank or or you

statewide funding state watch Monday night car she's got the DBAs down okay

so I really didn't know that you could do a purchase absolutely so one of the

things that I found is that the lenders are ultra worried about reverse fraud so

tell me about that because I feel like the long that I'm doing right now he

does not own a primary residence he only has an investment property so the lender

is is really concerned that he's not going to live in there and then the the

rep said that they're just really concerned that document that there's not

reverse fraud going on in these lives yes and we have you know they do have to

find something okay within their documents that they did it the purpose

of purchasing this property is intended for a non owner only so they're

declaring next but yeah I mean we we don't have an issue with it at home

Express as far is someone maybe renting a single-family residence or whatever

even an apartment and then being an experienced investor already having one

okay can get another so this is a great alternative

select the rates I heard the rates are really low like three and a half percent

I'm really I'm leading the conversation yeah okay so you're anywhere from you

know the big whores all the way to the success evans

the high seven okay so my borrower right now and I'm actually not doing him at

her company with another company it's a he wanted to thirty or six and six and

three-quarters and he's paying a couple of points and the lower so it's not that

bad but as like a 655 go so this is one of those great and best investor

products where you don't have to have 725 those for like a lot of the

traditional program out looking there the military we can go on the investor X

we can do