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Jumbo for SF owner occupied 4-plex

Hi - looking for jumbo loan for $2mm SF 4-plex owner occupied.   
I own 2 San Jose properties with ~$1mm equity which I will be renting (cash flow positive).  Since I have 2 other mortgages + the new SF one, I probably won't pass the DTI ratios.  What is the minimum down I will need to get a deal?   30%?  thanks!  Michelle
  • March 07 2014 - San Francisco
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Answers (5)

For the bank where I work, the Jumbo Elite will go to 75% LTV for a 3 or 4 unit property, for loan amounts from $1,500,000 to $2,500,000.  (80% LTV for lower loan amount, lower LTVs for higher loan amounts.) (We cannot offer a 2nd loan in this case, but allow seller carry back or other lender at 5% of price, to 80% CLTV.

This requires a 720 minimum qualifying credit score, and reserves.  For reserves we add up all your liquid assets, and percentages of retirement type accounts.  Total reserves needed depends on your montly debt amounts.

For qualifying we use 75% of the rent from the other 3 units.  For the other properties, use Schedule E income (adjusted) or if newly owned, 75% of the rent less PITI.  Your debt to income is calculated.  We have the ability to go over 43% DTI, up to 60% or higher with more financial reserves, using a formula unique to this Portfolio loan.

Loan choices include:  30 and 15 year fixed; ARMs: 3/1, 5/1, 7/1, 10/1; Interest only:  5/1, 30 yr fixed (interest only first 10 years.)

It is probably best in your situation which is somewhat complicted to do a Pre Approval with a lender.  That will give you a good idea on what you can qualify for and the documentation that will be required.  Better to have this documenation reviewed up front.
  • March 07 2014
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I was expecting having to come up with 30% ($600K) and then about another $100K in reserves.  Then I need for the lender to take 75% of all rents (3x for the SF property + 2x San Jose) and I will easily qualify, with rents so high now.  Sounds like there are at least some lenders willing to do this.  thanks
  • March 07 2014
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Profile picture for Tony Ngai
Any questions please give me a call. Maxreal also does financing. My loan manager, also owner, will be able to give you an exact number over the phone.
  • March 07 2014
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Hi Michelle

I have an investor that will go to 75% LTV, 80% CLTV meeting certain credit criteria, but I don't have the investor for the second. A seller carry back could get you there, but otherwise 25% down is the minimum with my options.

Feel free to reach out if you'd like assistance.

Cheers

Mike
  • March 07 2014
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Hi Michelle,

The minimum down payment would be 30% with our bank.  I would recommend discussing with a lender to see if you can include rental income to improve your DTI.

Best,

Bryan
  • March 07 2014
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