September 30, 2024 • 16 mins
In this episode of Daily Mortgage Rates LIVE!, we’re diving deep into the world of short-term rental property loans. With the rise of platforms like Airbnb and VRBO, investing in short-term rentals has never been more enticing—but how do you secure the right financing? Join us as we unpack everything you need to know about short-term rental property loans, from understanding different financing options to identifying the best lenders for your unique situation.
Plus, we’ll break down current mortgage rates and trends to help you make informed decisions. Don’t miss this opportunity to learn how to maximize your investment and avoid common pitfalls. Tune in for an episode packed with expert advice, real-life success stories, and the information you need to turn your short-term rental dreams into reality!
For more episodes visit: https://themortgagecalculator.com/Page/Daily-Mortgage-Rates-LIVE-Video-Podcast
About The Mortgage Calculator:
The Mortgage Calculator is a licensed Mortgage Lender (NMLS #2377459) that specializes in using technology to enable borrowers to access Conventional, FHA, VA, and USDA Programs, as well as over 5,000 Non-QM mortgage loan programs using alternative income documentation!
Using The Mortgage Calculator proprietary technology, borrowers can instantly price and quote thousands of mortgage loan programs in just a few clicks. The Mortgage Calculator technology also enables borrowers to instantly complete a full loan application and upload documents to our AI powered software to get qualified in just minutes!
Our team of over 350 licensed Mortgage Loan Originators can assist our customers with Conventional, FHA, VA and USDA mortgages as well as access thousands of mortgage programs using Alternative Income Documentation such as Bank Statement Mortgages, P&L Mortgages, Asset Based Mortgage Programs, No Ratio CDFI Loan Progra
The Mortgage Calculator is a licensed Mortgage Lender (NMLS #2377459) that specializes in using technology to enable borrowers to access Conventional, FHA, VA, and USDA Programs, as well as thousands of Non-QM mortgage loan program variations using alternative income documentation!
Using The Mortgage Calculator proprietary technology, borrowers can instantly price and quote thousands of mortgage loan programs in just a few clicks. The Mortgage Calculator technology also enables borrowers to instantly complete a full loan application and upload documents to our AI powered software to get qualified in just minutes!
Our team of licensed Mortgage Loan Originators can assist our customers with Conventional, FHA, VA and USDA mortgages as well as access thousands of mortgage programs using Alternative Income Documentation such as Bank Statement Mortgages
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Restream recording Sep 30, (00:00):
So, welcome everyone.
(00:01):
My name is Kyle Hiersche.
I am the COO of The MortgageCalculator, joined here by our
president, Nick Hiersche, andour CSO, Jose Gonzalez.
We are a lender that specializesin non QM loans, and what we do
every weekday at 11 a.
m.
Eastern on the show is gothrough our live mortgage rates
for a few standard programs, andthen we do a deep dive into a
different loan type.
Today's loan type is going to beshort term rental property
(00:21):
loans.
Very popular right now.
Definitely something verypopular here at the mortgage
calculator.
So before that, we'll go aheadand look at the rates though.
So Nick, if you are ready, let'sgo ahead and pull up today's
rates and see what they looklike.
All right.
So before I pull those up, wewant to go over what we're going
(00:43):
to look at here.
We're going to compare all ofthe standard programs here for
today.
It's September 30th, just after11 a.
m.
Eastern Solar standard programshave their initial rate sheets
for today.
And we will compare the APR.
If you'd like a full breakdownand itemized loan estimate that
breaks down all the fees that gointo the APR, please get with
our team members.
They'd be happy to help you out.
For the demos, we'll set up astandard scenario so we can
(01:04):
compare the APR.
We'll set up a single familyhome, 500, 000 purchase price,
400, 000 loan amount thatcorresponds to 20 percent down
payment, 80 percent loan tovalue.
And we use an estimated 760 FICOcredit score and an estimated 40
percent debt to income ratio.
So with those settings, let'scheck out today's rates.
(01:26):
So first up, 30 year fixedconventional for a primary home.
Back down below six, which isamazing.
It peaked up a little bit therelast week, but back down to
where we like to be.
Rates as low as 5.
625.
Final APR, 5.
939, which is awesome.
Definitely, uh, one and a halfyear lows, give or take, right
at this level, which is amazing.
And if for any reason ourcustomer doesn't qualify for a
(01:49):
conventional option, youtypically want to quote a
convention or a FHA option,which allows more leniency on
credit issues and a higher debtto income ratio, but does
require upfront and yearlymortgage insurance rates today
for FHA 4.
875 and a final APR with all ofthe mortgage insurance fees 5.
829.
So a touch cheaper thanconventional.
(02:10):
If our customer qualifies forboth, they may consider FHA.
They want to do the mortgageinsurance.
And our customers that need touse FHA, definitely a great
option, very comparable toconventional at this time.
And moving on to our VA optionsfor eligible vets and active
service members, these optionsare definitely the best for
eligible vets and active servicemembers.
(02:32):
Rates today 5.
125, final APR 5.
391 with a standard funding fee.
And notice if we compare to FHAand conventional, VA is always
going to be the best option foreligible borrowers.
And scrolling down to our finalstandard option here, our USDA
is only eligible for propertiesin USDA areas, the rural areas
(02:53):
of the country, the propertieseligible.
These are great options toconsider.
And USDA is coming in at 4.
99 today and a final APR of 5.
705 with all of the feesincluded.
So when we compare that to FHA,if our customers shopping in
those USDA areas, USDA is goingto be a touch cheaper and a
touch cheaper than conventionalas well.
So great option for those ruralareas.
(03:16):
And moving on to our non QMoptions.
Many other banks or lendersdon't have any non QM options.
They only have the standard andtherefore if the customer
doesn't qualify, they would haveto deny them.
But we have 5, 000 otheroptions.
First up here are 30 year fixednon QM all stock options for a
primary home.
So if our borrower doesn'tqualify for conventional FHA,
(03:37):
etc.
using tax returns.
And standard documentation, wecan switch to alternative docs,
such as bank statements, 1099s,P& Ls, asset related, all kinds
of options here.
Bank statement option coming intoday, absolutely amazing, 5.
875 rate.
Final APR, 6.
193, just a touch higher thanconventional.
It's pretty amazing when we canswitch to alternative docs.
(04:00):
For nearly identical coststhere.
So great option for ourborrowers that need to use all
docs, definitely get out theretoday and we can use all docs
for investment properties andtons of other options for
investments as well.
We'll go over.
So our non QM Altdoc bankstatement option 6.
5 rate final APR 6.
823.
(04:22):
And we'll compare that here toour other investment options.
First up are conventional.
Remember there are no governmentoptions, so no USDA, FHA or VA,
but we do have conventional.
Coming in today, 6.
25 final APR, 6.
581.
So beating, uh, non QM alt DOC,which is typical, but not quite
beating our favorite options,our DSCR, our favorite loan
(04:44):
programs here, stands for debtservice coverage ratio.
No income information neededfrom our borrower, no employment
information needed from ourborrower.
Simply use the estimated rentsfrom the appraisal to determine
a DSCR ratio.
The estimated rents can coverthe estimated expenses.
That's a DSCR ratio that is over1, aka the property cash flows
monthly, which is preferred.
(05:05):
First up, our 3 year prepaymentpenalty option coming in today,
6.
125 rate, final APR 6.
438, just a touch cheaper thanconventional, which is amazing.
And we can add a 5 yearprepayment penalty to sweeten
the deal even more, rates as lowas 5.
875.
Final APR, 6.
156, which beats conventionaloption if we add the five year
(05:25):
prepay, which is amazing.
And we have our no prepaymentpenalty option for DSCR.
Some states don't allow it andsome investors, uh, request no
prepayment penalty.
That's not a problem.
Rates as low as 6.
5, final APR, 6.
823, which is a touch aboveconventional for no prepay,
which is typical.
I would still say, uh, nearly ahundred percent of investors
would prefer this program evenat a higher cost.
(05:47):
Thank you.
And our final two options here,very popular request as many of
our customers have a firstmortgage that is lower than what
we're looking at today for allthe options and still want to
access their equity recordequity in the country.
So typically the only option is,uh, the most common option is a
HELOC, but that is a variablerate and much higher rates than
(06:08):
what we can offer for our 30year fixed second mortgage
options for a primary home.
Rates as low as 8.
125 to get that cash out of thatprimary home.
Final APR, 8.
527.
And we can even use theseoptions on investment
properties.
HELOCs are rare for investmentsand these rates are much lower
as well.
Rates as low as 9.
25.
Final APR, 9.
557 to get that cash out of aninvestment property.
(06:31):
And these are non QM loans.
So we have bank statement 1099,et cetera, different types of
income options.
Let's get into our topic fortoday.
Definitely one of our favoritethings are short term rental
property loans, Airbnbproperties, uh, very popular
requests, especially as rateshave Uh, risen over the last
(06:52):
couple of years, uh, most of ourinvestors have been focused on
getting their returns throughshort term rental, uh, typically
the returns are higher, sodefinitely a very common request
for us to structure these deals.
Uh, we typically use our DSCRoptions, but I can't select on
the live pricer, a property typeof short term rental.
(07:13):
So since we can't set that onthe live pricer demo, we have
Jose that'll go through ourspecific examples.
We have dozens, if not hundredsof different options for short
term rentals.
But they all vary slightly.
So Jose, let's talk about thevariations here and what we can
do.
And then let's look at our bestoptions.
everyone.
Thank you for j mortgage rateslive with Definitely short term
(07:33):
ren segments of the market.
U in line with all of our n Nowthe products mainly u when short
term rental in Our DSCR productsbecause of, um, all the, um,
(07:55):
different variations in theguidelines that allow us to
capture all the different typesof income that would be
applicable.
To be able to qualify theborrower for a short term rental
property.
Uh, please note that the biggestissue with the short term rental
properties is that there are noleases, right?
No permanent leases.
(08:15):
So that could affect the incomebeing considered from the
property.
For your traditional financing.
So let's get into our optionshere.
So I could share with you allthe different strategies that we
have for qualifying the shortterm rental property.
Now, the first one is using astandard type of insurance.
(08:35):
And this is just one of thestrategies that we have for
qualifying.
into the videos.
The first one is using astandard If there's anything
standard about an 85 percent LTVDSCR purchase loan, right?
That's what we're using here.
15 percent down.
This is for the scenario wherethe property qualifies using
long term rent.
Now, this is a purchase.
(08:56):
So the borrower, uh, canstructure the purchase, however
they need to.
Right.
So in this case, if we do ourresearch and we find out that
the short, that the long termrent for the property qualifies
at 85 percent LTV with a DSCRloan, that's the option that we
would pick.
And you see very good ratesthere.
(09:18):
7.
9.
Nine nine is actually at par andwe can buy that down all the way
to 6.
749.
This is 15 percent down, uh,which is the lowest down payment
for an investment property.
And this is using long term rentwith DSCR, which is an amazing
(09:40):
option.
Now, if the, uh, long term rentdoes not cover at 15 percent
down.
Then in order to be able to usea short term rental income, we
would have to lower the LTV to80%.
So it would have to be a 20percent down loan.
But this one allows us to useair DNA income, right?
(10:04):
The only catch is our DSCR hasto be at least 1.
5.
But if it's a good short termrental property, uh, and you are
using air DNA income, then youshould hit the mark.
of 1.
5.
And look at those rates.
Absolutely amazing.
6.
625 with a lender credit of 0.
(10:27):
025.
And you can buy that down allthe way to 5.
5%.
That is our lowest rate option.
And this is using AirDNA incometo qualify at an 80 percent LTV.
So for those properties that,um, the long term rent doesn't
(10:49):
cover and the short term rentmay not be possible to use
because maybe there are no airDNA comps in the area.
It could be that the seller wasnot using the property as a
short term rental.
So the seller cannot providerevenue reports for the last 12
months.
Borrower says, this is a greatproperty.
(11:11):
I have other short term rentals,and I know that my business
model can be applied to thisproperty, Jose, and I'm going to
make money.
So then we would use the lowratio.
We have two options here.
The first one would be the lowratio DSCR, where the debt
service coverage ratio isbetween 0.
75 and 0.
(11:31):
99.
Using long term rent.
So then all we would need hereis 25 percent down payment, 75
percent LTV.
And you're going to get thesegreat rates, 7.
375 lowest cost option at par.
And you can buy that down allthe way to 5.
99.
(11:51):
at a cost of 3.
475 points for our low ratioDSCR purchased 25 percent down
for our short term property.
Now, for those scenarios wherethe, uh, long term rent provides
less than 0.
75 DSCR, but the borrower says,Jose, I want it.
(12:13):
I know I can make it happen withthat property.
Just get me in.
Well, then this is the product25 percent down for a no ratio
where the debt service coverageratio is less than 0.
71, still great rates here.
8.
4, nine, nine lowest cost optionat par.
(12:36):
And you can buy that down allthe way to 6.
9, nine, nine, at a cost of 3.
35 points.
And now our last two examplesare for cash out refis and I got
some pretty interesting ones foryou here, because we actually
have a cash out refi that willallow you to use air DNA.
(13:01):
For a property recently put intoservice.
Now, as you all know, usuallyfor refi, you can't use air DNA,
but you know that at themortgage calculator, we love
solutions.
We love options.
So we do have an air DNA cashout refi option, but please know
this is for a property recentlyput into service.
(13:21):
Maybe it was just a recentlypurchased.
It was a renovated, you know,furnished, uh, screw stuck.
Uh, and now was just put intoservice and you have all the
proof from the platform that youjust put into service all the
information that you need toprovide to show that it was just
put into service, then this isthe one for you.
7.124 is the lowest cost optionat par, and you can buy that
(13:45):
down all the way to 6.374 at acost of 3.1 points.
Now that's for, uh, the propertythat does not have 12 months.
of revenue reports.
However, last option here, ifyou do have 12 months of revenue
report for your refi, then asyou can see, rates are better.
(14:08):
Much better.
So now we're looking for ourcash out refi 6.
875 is our lowest cost optionwith a 0.
15 point lender credit and youcan buy that down all the way to
an amazingly low 5.
875 at a cost of 3.
35 for our Short term rentalproperty cash out 75 percent LTV
(14:32):
using the revenue reports fromthe last 12 months.
So look to the mortgagecalculator for all your short
term rental property financing.
Let's see here.
If you have any questions, youcan go ahead and put them there
in the chat.
It looks like we do have onequestion here.
(14:52):
First question is how would youcalculate long term rent on a
short term rental property byusing the two most recent tax
returns the property was claimedon?
Well, um, no, when we order theappraisal, right, we order also
depending on the property type,if it's a one unit, we would
order a 1007 market rent.
And if it's a two to four unit,we would order the 216 income,
(15:15):
uh, operating state.
So that's going to calculate themarket rent and then that is
what will be used byunderwriting to calculate the
income for the property when youare using long term rent.
Now if you're, I mean, if you'reusing short term rent, then it's
AirDNA or Revenue Reports forthe last 12 months.
(15:42):
I don't see any other questionshere, so I think we can go ahead
and move on.
And wrap it up though,definitely great programs there.
Remember that we do this at 11a.
m.
Eastern every weekday.
We'll go through our live ratesand then do a deep dive into a
different loan type.
So we'll have a new loan typefor you tomorrow.
We appreciate everybody tuningin and we'll see you tomorrow at
11 a.
m.
Eastern for the next episode ofDaily Rates Live with the
Mortgage Calculator.
So, welcome everyone.
(00:01):
My name is Kyle Hiersche.
I am the COO of The MortgageCalculator, joined here by our
president, Nick Hiersche, andour CSO, Jose Gonzalez.
We are a lender that specializesin non QM loans, and what we do
every weekday at 11 a.
m.
Eastern on the show is gothrough our live mortgage rates
for a few standard programs, andthen we do a deep dive into a
different loan type.
Today's loan type is going to beshort term rental property
(00:21):
loans.
Very popular right now.
Definitely something verypopular here at the mortgage
calculator.
So before that, we'll go aheadand look at the rates though.
So Nick, if you are ready, let'sgo ahead and pull up today's
rates and see what they looklike.
All right.
So before I pull those up, wewant to go over what we're going
(00:43):
to look at here.
We're going to compare all ofthe standard programs here for
today.
It's September 30th, just after11 a.
m.
Eastern Solar standard programshave their initial rate sheets
for today.
And we will compare the APR.
If you'd like a full breakdownand itemized loan estimate that
breaks down all the fees that gointo the APR, please get with
our team members.
They'd be happy to help you out.
For the demos, we'll set up astandard scenario so we can
(01:04):
compare the APR.
We'll set up a single familyhome, 500, 000 purchase price,
400, 000 loan amount thatcorresponds to 20 percent down
payment, 80 percent loan tovalue.
And we use an estimated 760 FICOcredit score and an estimated 40
percent debt to income ratio.
So with those settings, let'scheck out today's rates.
(01:26):
So first up, 30 year fixedconventional for a primary home.
Back down below six, which isamazing.
It peaked up a little bit therelast week, but back down to
where we like to be.
Rates as low as 5.
625.
Final APR, 5.
939, which is awesome.
Definitely, uh, one and a halfyear lows, give or take, right
at this level, which is amazing.
And if for any reason ourcustomer doesn't qualify for a
(01:49):
conventional option, youtypically want to quote a
convention or a FHA option,which allows more leniency on
credit issues and a higher debtto income ratio, but does
require upfront and yearlymortgage insurance rates today
for FHA 4.
875 and a final APR with all ofthe mortgage insurance fees 5.
829.
So a touch cheaper thanconventional.
(02:10):
If our customer qualifies forboth, they may consider FHA.
They want to do the mortgageinsurance.
And our customers that need touse FHA, definitely a great
option, very comparable toconventional at this time.
And moving on to our VA optionsfor eligible vets and active
service members, these optionsare definitely the best for
eligible vets and active servicemembers.
(02:32):
Rates today 5.
125, final APR 5.
391 with a standard funding fee.
And notice if we compare to FHAand conventional, VA is always
going to be the best option foreligible borrowers.
And scrolling down to our finalstandard option here, our USDA
is only eligible for propertiesin USDA areas, the rural areas
(02:53):
of the country, the propertieseligible.
These are great options toconsider.
And USDA is coming in at 4.
99 today and a final APR of 5.
705 with all of the feesincluded.
So when we compare that to FHA,if our customers shopping in
those USDA areas, USDA is goingto be a touch cheaper and a
touch cheaper than conventionalas well.
So great option for those ruralareas.
(03:16):
And moving on to our non QMoptions.
Many other banks or lendersdon't have any non QM options.
They only have the standard andtherefore if the customer
doesn't qualify, they would haveto deny them.
But we have 5, 000 otheroptions.
First up here are 30 year fixednon QM all stock options for a
primary home.
So if our borrower doesn'tqualify for conventional FHA,
(03:37):
etc.
using tax returns.
And standard documentation, wecan switch to alternative docs,
such as bank statements, 1099s,P& Ls, asset related, all kinds
of options here.
Bank statement option coming intoday, absolutely amazing, 5.
875 rate.
Final APR, 6.
193, just a touch higher thanconventional.
It's pretty amazing when we canswitch to alternative docs.
(04:00):
For nearly identical coststhere.
So great option for ourborrowers that need to use all
docs, definitely get out theretoday and we can use all docs
for investment properties andtons of other options for
investments as well.
We'll go over.
So our non QM Altdoc bankstatement option 6.
5 rate final APR 6.
823.
(04:22):
And we'll compare that here toour other investment options.
First up are conventional.
Remember there are no governmentoptions, so no USDA, FHA or VA,
but we do have conventional.
Coming in today, 6.
25 final APR, 6.
581.
So beating, uh, non QM alt DOC,which is typical, but not quite
beating our favorite options,our DSCR, our favorite loan
(04:44):
programs here, stands for debtservice coverage ratio.
No income information neededfrom our borrower, no employment
information needed from ourborrower.
Simply use the estimated rentsfrom the appraisal to determine
a DSCR ratio.
The estimated rents can coverthe estimated expenses.
That's a DSCR ratio that is over1, aka the property cash flows
monthly, which is preferred.
(05:05):
First up, our 3 year prepaymentpenalty option coming in today,
6.
125 rate, final APR 6.
438, just a touch cheaper thanconventional, which is amazing.
And we can add a 5 yearprepayment penalty to sweeten
the deal even more, rates as lowas 5.
875.
Final APR, 6.
156, which beats conventionaloption if we add the five year
(05:25):
prepay, which is amazing.
And we have our no prepaymentpenalty option for DSCR.
Some states don't allow it andsome investors, uh, request no
prepayment penalty.
That's not a problem.
Rates as low as 6.
5, final APR, 6.
823, which is a touch aboveconventional for no prepay,
which is typical.
I would still say, uh, nearly ahundred percent of investors
would prefer this program evenat a higher cost.
(05:47):
Thank you.
And our final two options here,very popular request as many of
our customers have a firstmortgage that is lower than what
we're looking at today for allthe options and still want to
access their equity recordequity in the country.
So typically the only option is,uh, the most common option is a
HELOC, but that is a variablerate and much higher rates than
(06:08):
what we can offer for our 30year fixed second mortgage
options for a primary home.
Rates as low as 8.
125 to get that cash out of thatprimary home.
Final APR, 8.
527.
And we can even use theseoptions on investment
properties.
HELOCs are rare for investmentsand these rates are much lower
as well.
Rates as low as 9.
25.
Final APR, 9.
557 to get that cash out of aninvestment property.
(06:31):
And these are non QM loans.
So we have bank statement 1099,et cetera, different types of
income options.
Let's get into our topic fortoday.
Definitely one of our favoritethings are short term rental
property loans, Airbnbproperties, uh, very popular
requests, especially as rateshave Uh, risen over the last
(06:52):
couple of years, uh, most of ourinvestors have been focused on
getting their returns throughshort term rental, uh, typically
the returns are higher, sodefinitely a very common request
for us to structure these deals.
Uh, we typically use our DSCRoptions, but I can't select on
the live pricer, a property typeof short term rental.
(07:13):
So since we can't set that onthe live pricer demo, we have
Jose that'll go through ourspecific examples.
We have dozens, if not hundredsof different options for short
term rentals.
But they all vary slightly.
So Jose, let's talk about thevariations here and what we can
do.
And then let's look at our bestoptions.
everyone.
Thank you for j mortgage rateslive with Definitely short term
(07:33):
ren segments of the market.
U in line with all of our n Nowthe products mainly u when short
term rental in Our DSCR productsbecause of, um, all the, um,
(07:55):
different variations in theguidelines that allow us to
capture all the different typesof income that would be
applicable.
To be able to qualify theborrower for a short term rental
property.
Uh, please note that the biggestissue with the short term rental
properties is that there are noleases, right?
No permanent leases.
(08:15):
So that could affect the incomebeing considered from the
property.
For your traditional financing.
So let's get into our optionshere.
So I could share with you allthe different strategies that we
have for qualifying the shortterm rental property.
Now, the first one is using astandard type of insurance.
(08:35):
And this is just one of thestrategies that we have for
qualifying.
into the videos.
The first one is using astandard If there's anything
standard about an 85 percent LTVDSCR purchase loan, right?
That's what we're using here.
15 percent down.
This is for the scenario wherethe property qualifies using
long term rent.
Now, this is a purchase.
(08:56):
So the borrower, uh, canstructure the purchase, however
they need to.
Right.
So in this case, if we do ourresearch and we find out that
the short, that the long termrent for the property qualifies
at 85 percent LTV with a DSCRloan, that's the option that we
would pick.
And you see very good ratesthere.
(09:18):
7.
9.
Nine nine is actually at par andwe can buy that down all the way
to 6.
749.
This is 15 percent down, uh,which is the lowest down payment
for an investment property.
And this is using long term rentwith DSCR, which is an amazing
(09:40):
option.
Now, if the, uh, long term rentdoes not cover at 15 percent
down.
Then in order to be able to usea short term rental income, we
would have to lower the LTV to80%.
So it would have to be a 20percent down loan.
But this one allows us to useair DNA income, right?
(10:04):
The only catch is our DSCR hasto be at least 1.
5.
But if it's a good short termrental property, uh, and you are
using air DNA income, then youshould hit the mark.
of 1.
5.
And look at those rates.
Absolutely amazing.
6.
625 with a lender credit of 0.
(10:27):
025.
And you can buy that down allthe way to 5.
5%.
That is our lowest rate option.
And this is using AirDNA incometo qualify at an 80 percent LTV.
So for those properties that,um, the long term rent doesn't
(10:49):
cover and the short term rentmay not be possible to use
because maybe there are no airDNA comps in the area.
It could be that the seller wasnot using the property as a
short term rental.
So the seller cannot providerevenue reports for the last 12
months.
Borrower says, this is a greatproperty.
(11:11):
I have other short term rentals,and I know that my business
model can be applied to thisproperty, Jose, and I'm going to
make money.
So then we would use the lowratio.
We have two options here.
The first one would be the lowratio DSCR, where the debt
service coverage ratio isbetween 0.
75 and 0.
(11:31):
99.
Using long term rent.
So then all we would need hereis 25 percent down payment, 75
percent LTV.
And you're going to get thesegreat rates, 7.
375 lowest cost option at par.
And you can buy that down allthe way to 5.
99.
(11:51):
at a cost of 3.
475 points for our low ratioDSCR purchased 25 percent down
for our short term property.
Now, for those scenarios wherethe, uh, long term rent provides
less than 0.
75 DSCR, but the borrower says,Jose, I want it.
(12:13):
I know I can make it happen withthat property.
Just get me in.
Well, then this is the product25 percent down for a no ratio
where the debt service coverageratio is less than 0.
71, still great rates here.
8.
4, nine, nine lowest cost optionat par.
(12:36):
And you can buy that down allthe way to 6.
9, nine, nine, at a cost of 3.
35 points.
And now our last two examplesare for cash out refis and I got
some pretty interesting ones foryou here, because we actually
have a cash out refi that willallow you to use air DNA.
(13:01):
For a property recently put intoservice.
Now, as you all know, usuallyfor refi, you can't use air DNA,
but you know that at themortgage calculator, we love
solutions.
We love options.
So we do have an air DNA cashout refi option, but please know
this is for a property recentlyput into service.
(13:21):
Maybe it was just a recentlypurchased.
It was a renovated, you know,furnished, uh, screw stuck.
Uh, and now was just put intoservice and you have all the
proof from the platform that youjust put into service all the
information that you need toprovide to show that it was just
put into service, then this isthe one for you.
7.124 is the lowest cost optionat par, and you can buy that
(13:45):
down all the way to 6.374 at acost of 3.1 points.
Now that's for, uh, the propertythat does not have 12 months.
of revenue reports.
However, last option here, ifyou do have 12 months of revenue
report for your refi, then asyou can see, rates are better.
(14:08):
Much better.
So now we're looking for ourcash out refi 6.
875 is our lowest cost optionwith a 0.
15 point lender credit and youcan buy that down all the way to
an amazingly low 5.
875 at a cost of 3.
35 for our Short term rentalproperty cash out 75 percent LTV
(14:32):
using the revenue reports fromthe last 12 months.
So look to the mortgagecalculator for all your short
term rental property financing.
Let's see here.
If you have any questions, youcan go ahead and put them there
in the chat.
It looks like we do have onequestion here.
(14:52):
First question is how would youcalculate long term rent on a
short term rental property byusing the two most recent tax
returns the property was claimedon?
Well, um, no, when we order theappraisal, right, we order also
depending on the property type,if it's a one unit, we would
order a 1007 market rent.
And if it's a two to four unit,we would order the 216 income,
(15:15):
uh, operating state.
So that's going to calculate themarket rent and then that is
what will be used byunderwriting to calculate the
income for the property when youare using long term rent.
Now if you're, I mean, if you'reusing short term rent, then it's
AirDNA or Revenue Reports forthe last 12 months.
(15:42):
I don't see any other questionshere, so I think we can go ahead
and move on.
And wrap it up though,definitely great programs there.
Remember that we do this at 11a.
m.
Eastern every weekday.
We'll go through our live ratesand then do a deep dive into a
different loan type.
So we'll have a new loan typefor you tomorrow.
We appreciate everybody tuningin and we'll see you tomorrow at
11 a.
m.
Eastern for the next episode ofDaily Rates Live with the
Mortgage Calculator.
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