Working with RELM: The Rental Loan Process – From Start to Close
Investing in rental properties has never been easier with RELM’s streamlined rental loan process. We understand the unique needs of real estate investors, and our dedicated team is here to guide you through every step. Here’s a comprehensive overview of the RELM rental loan journey:
Step 1
Pre-qualification
Getting pre-qualified with RELM is a breeze. Access our user-friendly online platform, enter the property address, and answer a few personal questions. As part of the prequalification process, we perform a soft credit pull, which won’t impact your credit scores.
For rental property financing, RELM evaluates FICO scores and leverage as key qualifiers. Leverage is influenced by both FICO and DSCR (Debt Service Coverage Ratio).
DSCR plays a crucial role in determining the maximum loan amount for real estate investors. It measures the property’s ability to cover its mortgage and expenses. A higher DSCR allows for more leverage, and a minimum DSCR of 1.1 is required to prequalify.
ProTip: If you’re choosing between properties, reach out to your RELM representative. We’ll review the numbers with you and offer our expertise to answer your questions.
Step 2
Loan Application
Once you’ve found the perfect property, it’s time to submit your application. Simply click the “Submit for Review” button on our online platform to initiate your financing application. For RELM’s Rental Loans, you’ll also need to pay a third-party appraisal fee at this stage.
Once your application is 100% complete, including the appraisal fee payment, your loan moves to the next phase.
Note: Before submitting your application, contact your RELM representative for insights and guidance. We’re here to assist with any questions.
Step 3
Processing
After completing your loan application, it’s assigned to a dedicated loan processor. The processor conducts an initial review and initiates orders with title and insurance companies while also scheduling an appraisal. An appraisal provides an unbiased professional opinion of the property’s value and is a requirement for all RELM rental property loans.
Step 4
Appraisal
Once the appraisal is ordered, there is a waiting period during which the appraisal is accepted by the appraiser, scheduled, and conducted. This process typically takes around 30+ days to complete. Once done, the appraisal report is sent to RELM, ultimately determining the property’s value based on the appraiser’s observations.
Valuation
RELM’s valuations team reviews the appraisal report to ensure it aligns with RELM’s credit policy and calculates the loan-to-value (LTV) ratio. LTV compares the loan amount with the property’s value, with the borrower covering the remaining amount at closing.
When all outstanding conditions are met, the appraisal is sent to the underwriter for the final review.
Underwriting
RELM’s experienced underwriters meticulously review the entire file to ensure it meets guidelines, standards, and that all paperwork is accurate and error-free. Underwriters also have the authority to request additional conditions from the appraiser if needed.
Note: Promptly respond if your underwriter reaches out with questions to keep your loan on track and avoid closing delays.
Closing
Once underwriting approves your loan, it’s time to close. Our closing department collaborates with the title agent you selected at the beginning to coordinate the closing date and provide necessary documents.
RELM handles sending all loan documents to the title agent for signing and wiring loan proceeds for delivery to you. At the closing table, you’ll sign required documents, exchange funds, and receive the keys to your property.
The title company ensures proper execution of legally required loan documents and verifies insurance. After loan documents are signed, the agent sends the originals back to the lender, and funds are released.
With RELM, investing in rental properties has never been more efficient and accessible. Let us help you seize real estate investment opportunities with confidence.
