Interview transcript from the closed captioned interview:
Steve O: Good afternoon, everyone! Welcome to another exciting episode of “Ask the Expert Show.” Today, we’re broadcasting from rainy Florida instead of our usual sunny location. But don’t worry, we’re piecing everything together to make it a great show. And speaking of great, we have an amazing topic lined up for today—mortgages! I’m feeling confident that we’re back on the air, so let’s dive right in. But before we do, I want to extend a warm hello to our expert, Jackie. Jackie, can you hear me alright?
Jackie: Hi there! Yes, I can hear you loud and clear. It’s a pleasure to be here.
Steve O: Fantastic! Although I can’t see you on the screen as we usually do, I’m relieved that our audio connection is working perfectly fine. Now, let me take a moment to acknowledge our show’s sponsor for today, Dr. Vivek Gupta. Now, let’s shift our focus to our expert, Jackie Barikhan, who specializes in mortgages. Jackie, I love having you here!
Jackie: Thank you so much! It’s a pleasure to be part of the show.
Steve O: Wonderful! Today, we’ll be firing questions at Jackie, and here’s an exciting announcement: in the coming three to four weeks, we’ll be collecting your questions to present to Jackie in next month’s show. So, stay tuned for that! But first, let’s hear more about Jackie’s company. Take it away, Jackie.
Jackie: Absolutely! Thank you for asking, Steve. I’ve been in the mortgage business for almost 30 years now. We handle all kinds of mortgage loans, catering to a wide range of borrowers. From A-paper borrowers with conventional documentation like W-2s and pay stubs to our specialty, helping self-employed borrowers who may not have non-traditional income verification, but strong bank statements—we have experience with it all. Last time, we talked about these unique loan programs. Additionally, we offer a fantastic program for property investors, which I’d love to delve into more details about today.
Steve O: Today, we’re going to dive into the topic of cash flow programs for investors and how it helps secure home loans for property investors. Jackie, I know you work with tons of investors, especially in California. Is the real estate market still as active as before?
Jackie: Absolutely, the market is still quite active. We’re staying busy with a lot of property investors. The cash flow program we have is particularly special, because it streamlines the process. With our bank statement loan, which we discussed last time, we use bank statements to verify income. But with the cash flow program, it’s solely based on the rental income of the property.
We don’t verify any other income sources except for the rent received. It’s somewhat similar to a commercial loan, but on a smaller scale.
Steve O: That’s interesting. Can you explain the key features and benefits of how this cash flow investor loan program works?
Jackie: Certainly! The program is highly streamlined. It focuses on the market rent of the property. We consider the borrower’s credit score, with a minimum requirement typically around 640. The higher the credit score, the better the interest rate. The foundation of the program is matching the mortgage payment or keeping it lower than the rental income received. There’s no need for tax returns, W-2s, or bank statements. It’s a simple and straightforward process.
Steve O: That sounds convenient. Are there any other eligibility requirements for this cash flow home loan?
Jackie: Absolutely, eligibility requirements are essential. One important aspect is looking at the borrower’s assets, particularly if they’re purchasing a property.
We want to see how much money they have in the bank as a backup. If it’s a cash-out refinance, the cash-out amount from the refinance can be considered as assets. So assets play a role, along with credit history and housing payment history. We want to see that the borrower has been able to make timely payments to other mortgage companies. It’s worth noting that this program is not suitable for first-time homebuyers. It’s more appropriate for those who have previously owned a home and are looking to purchase their first investment property or expand their portfolio.
Steve O: That provides clarity. How do you handle clients who are overseas or living outside of the country? Do you also have ITIN programs and foreign national programs that could be a good fit for this cash flow loan program?
Jackie: Dealing with clients who are overseas can present some unique challenges. However, we have experience working with such clients. Communication is key, and we make use of technology to facilitate smooth interactions. We can work through email, phone calls, and online document sharing platforms to gather the necessary information and documentation. While it may require some additional coordination, we strive to make the process as convenient as possible for our overseas clients.
Absolutely, we do offer ITIN programs and foreign national programs, which can be suitable candidates for this cash flow loan program. When it comes to credit score, it is important, but income is not a factor in this program. We don’t look at tax returns or bank statements. The focus is solely on the rental income of the property. For example, if you have a single-family home on the beach that rents out for $5,000 a month, as long as we can structure a loan that keeps the mortgage payment under $5,000, it qualifies.
Additionally, we now have programs that consider Airbnb rental income, which can be significantly more than a long term rental, especially for beachfront properties. So there are multiple ways to verify income, but the primary method is based on the rental income generated by the specific property.
Steve O: Jackie, one thing I’ve noticed about you is your creativity and your knowledge of all the mortgage options out there. It’s crucial to work with someone who stays informed and doesn’t miss out on potential opportunities. Can you share your thoughts on this?
Jackie: Thank you, Steve, for recognizing that. With almost 30 years of experience in the industry, we’ve developed a level of creativity and deep knowledge of non-qualified mortgage (non-QM) loans. Being specialists in these loans is vital because they require proper structuring.
While conventional loans also require expertise, non-QM loans are a whole different animal. The investors that buy these types of loans, such as Wall Street entities, hedge funds, and insurance companies, have specific rules and guidelines for these types of loans, and various banks, all have slightly different criteria.
It’s important to work with an expert who understands how to handle cash flow loans for investors or bank statement loans, as these loans need to be structured correctly to meet the investors’ criteria.
It’s not about bending rules, but rather knowing how to present the loan in a way that appeals to the investors, ensuring a smooth closing process.
So having that expertise and creativity is essential.
Steve O: That’s insightful, Jackie. We just received a text from a listener asking do you only work in a certain part of town or if you cover the entire Southern California area?
Jackie: We can offer these cash flow loans in various parts of the United States, with a few exceptions. While we are licensed in the state of California, we can provide cash flow loans in almost every state. So we have a broad coverage area.
Steve O: I believe that answers our listener’s question. Thank you, Jackie, for sharing all this valuable information about the cash flow investor loan program and your expertise in the field. What are the terms and conditions for a cash flow investor loan?
Jackie: The typical terms and conditions for a cash flow investor loan are similar to conventional loans. You can choose between a 30-year fixed rate or adjustable rate mortgages, such as 5/1 or 10/1 ARMs. Some investors prefer the interest-only option, which allows them to pay only the interest for the first 10 years before converting to a 30-year fixed rate. These loans are considered safe, with no unexpected interest rate increases.
Steve O: Can you please explain the process for applying for a cash flow loan for investors?
Jackie: When it comes to applying for a cash flow investor loan, the process is streamlined and simplified compared to traditional loans. The documentation required is minimal. You’ll need to provide basic personal information like your name, date of birth, social security number, and address. Unlike traditional loans, you won’t have to submit detailed income documentation or employment details. The focus is primarily on credit analysis, property evaluation, and equity position. Streamlined process is better.
Steve O: How do they demonstrate the rental income for cash flow investor loans?
Jackie: To demonstrate the rental income for the cash flow secure home loan, an appraisal is conducted on the property. The appraisal determines the value of the property based on comparable sales in the area. In addition to the appraisal, a form called the 1007 is used to evaluate the market rent. It compares rental rates of similar properties in the neighborhood to determine an average rental income for the property being financed. The loan amount is then based on this rental income figure.
Overall, the cash flow loan program for investors simplifies the application process and focuses on the rental income of the property, making it a viable option for investors who may not qualify for traditional loans due to complex income situations or multiple investment properties.
Steve O: So, Jackie, Can you tell us about the current state of rental properties? Are the values still going up, or have they leveled out?
Jackie: Well, I’m seeing property values holding steady. Real estate is very regional, so it depends on the city, county, and state. Overall, here in California, values are holding steady. There’s hardly any inventory on the market, and there’s still a lot of demand. People are even overbidding on properties. So, our rental properties are still holding value in this market.
Steve O: That’s great to hear because we often hear stories about people moving out of California. Is that really the case?
Jackie: Well, I’m sure there are people moving out for various reasons, we’re still staying busy, especially with these types of home loans. Cash flow home loans are a great choice for our investors, and self-employed individuals that have strong bank statements can use the bank statement programs. We always make sure to put our clients in a position where they’re safe and can make their mortgage payments on time. So, it’s not as dire as some may believe.
Steve O: That’s reassuring. Now, let’s talk about the hot areas in Southern California. Where should our listeners be looking?
Jackie: I believe Long Beach has a lot of potential for growth. Although it needs some work, we’re seeing a lot of investment flowing into that area. I think it’s going to be the next hot thing. And of course, Orange County, where I’m at, is amazing. It’s like a little bubble, super nice. Downtown San Diego is another example of an area that has seen tremendous growth over the years.
Steve O: Interesting! It’s always fascinating to see how different areas evolve. Now, Jackie, could you please share your contact information with our listeners?
Jackie: Absolutely! You can reach me directly at 949-600-0944, or you can visit my website at mylenderjackie.com. There, you’ll find various ways to connect with me and explore different options.
Steve O: Fantastic! Make sure to write down Jackie’s phone number, folks. You never know when you’ll need it. Now, Jackie, I believe you had a story or example to share with us?
Jackie: Yes, I’d love to share a little story. Let’s say you own a single-family residence and a couple of other rental properties, and you want to add another rental property to your portfolio. Well, this cash flow program is perfect for you. You can pull cash out of one of your existing rental properties and use that money as a down payment on the next investment property. It’s a streamlined process, simple, and these loans close in less than 30 days. It’s a terrific program for real estate investors.
Steve O: That sounds like a great opportunity. Is this cash flow program new?
Jackie: It’s relatively new and gaining popularity. It’s a great option for investors, and many people are unaware of it. So, I’m glad we could discuss it today.
Steve O: Wonderful! It’s always good to have more options for financing. Jackie, do you have a website address you’d like to share?
Jackie: Certainly! You can visit my website at mylenderjackie.com. If you want to set up an appointment to talk with me directly, you can go to talkwithjackie.com and schedule a 20-minute complimentary session. I’m here to answer any questions you may have about mortgage loans.
Steve O: Excellent! Jackie’s company is My Lender Jackie. You can reach her at 949-600-0944 or visit mylenderjackie.com. This is only Jackie’s second show with us, so we’re looking forward to having her back next month. If you know anyone who’s planning to purchase a home, Jackie is the name to give them. Jackie, we’re glad to have you here.
Jackie: Thank you, Steve. I’ll do my best. Take care.
Steve O: That wraps up today’s show. Thank you for tuning in to the Ask the Expert Show on W4CY Radio and Talk 4 TV. Join us next week for more expert insights on various topics ranging from personal injury, insurance, air conditioning repairs, estate planning, Medicare, and more. Remember, we’re here to educate and provide you with the best experts in their fields. Stay dry and see you next week!