How to Finance a Short Term Rental in Branson: An Investor’s Guide

Avery [00:00:00]:
Foreign Everybody, welcome to the Short Term show special episode series on Branson, Missouri where we are doing a 10 episode deep dive on how to buy a short term rental in Branson. So we’ve got a few supplemental materials for y’ all in addition to the content on this podcast over on our website. So any questions you have about purchase prices and searching properties, you can do that on our website. We also have the Air DNA data thanks to our friends over at Air DNA income data on properties in Branson. So you can find these things at the short term shop.com so www.the shorttermshop.com Purchase prices and income data. If you want to buy a short term rental property with a short term shop agent in Branson, you can email us at agents the ShortTermshop.com or if you just like us, you just want to hang out with us more, there’s a few ways you can do that. Can join our Facebook group. It’s the same title as my book.

Avery [00:00:59]:
It’s called Short Term Rental Long Term. We we are over there talking about short term rental investing all day, every day. Or if you prefer to talk to us in person or virtual person, you can join our Zoom call that we have every Thursday. You sign up for that@strquestions.com. we’ll catch you guys over there. Hey guys, welcome back to another short term show special episode series episode on Branson. Today we’re talking about financing which is a little bit interesting in the Branson market because you would think that you are buying cabins. But as we’ve discussed in previous episodes, a lot of those, even if they are single family like looking cabins, they are usually detached condos which will require some special financing.

Avery [00:01:54]:
So I’ve got a great panel here to talk about this. Bill, I’ll let you introduce yourself first. Even though everyone is familiar with you at this point. Go ahead.

Bill Beck [00:02:02]:
My name is Bill. I moved to Branson in 2020. I used to work for Evolve as a home buying consultant nationally. So I help people buy vacation rental investment properties all over the country. That’s where I met Avery. I just joined the short term shop a couple weeks ago and I primarily work with people in this short term rental second home space.

Avery [00:02:24]:
Awesome. And next we have Lynette Van Gundy. Lynette, you want to introduce yourself?

Lynette Van Gundy [00:02:29]:
Yes. Good morning. I’m Lynette Van Gundy and I work with Simmons bank in the Teeny and Stone County Missouri area.

Avery [00:02:35]:
Awesome. Thank you so much for coming on. So since you’re here, we don’t have to continue saying, oh, I’m not a licensed loan officer, I can’t answer that. So you get to be that licensed loan officer to answer the questions for us.

Lynette Van Gundy [00:02:48]:
Okay, I’ll do my best.

Avery [00:02:51]:
All right, so first let’s start with, let’s just do a few definitions for people who might not be familiar with the different types of loans and why you have to get this specific type of loan for condos. So conventional loans, typically, for those of you, you who aren’t aware, which most of you probably are, if you’ve made it as far into this series as you are a conventional loan, you can find those at any bank, mortgage broker, credit union, anywhere in the country. And those types of loans are Fannie Mae and Freddie Mac backed usually. And so there’s a lot of guidelines on those. But those types of loans, they are using your debt to income ratio to qualify you for the property. Your credit score is a big part of that. And you can only get them in your personal name. Can’t get them in an LLC or anything like that.

Avery [00:03:43]:
There’s a few types of conventional loans that people use when it comes to short term and vacation rentals. Typically an investment loan is probably the way to go. And a lot of people mistakenly think that the minimum percent down you can put on an investment loan is 20 or 25%. It’s actually 15%. It just depends on where you’re getting the loan and what the rules are at that particular company. But you can put down 15% on a conventional investment loan. What else? On conventional, you can only have 10 finance properties when it comes to conventional. So you can have 10 in your personal name if you’re married and you can each qualify for 10 homes on your own, you can each have 10.

Avery [00:04:27]:
But keep in mind, if you are putting both of your names on every property, you can only have 10 collectively. The other type of loan, conventional loan that people use a lot is a vacation home loan. And those are great because you only have to put 10% down. But there are some rules around that. So you’re. The primary intent for those types of loans is you have to be using the property as a vacation home. And you’re welcome to rent it out to make money when you’re not using it. But it does have to be be something that you are using yourself.

Avery [00:05:02]:
So I want everybody to be very careful with those types of loans. And we’re going to talk more about this in a minute, but making sure that you’re following the rules about that. If you are running spreadsheets on it, running cash on cash return scenarios. You probably need to just go ahead and put that extra 15 or sorry, the extra 5 to 10% down to make it a true investment loan, to make sure that you are following the rules. There’s a lot of people out there that try to get real cute about the rules and I don’t want anyone who ever gets in trouble to be anyone who has listened to our podcast. So when it comes to vacation home loans, they’re really, really great. It is nice to only have to put down 10%. But keep in mind it does have to be a vacation home and there’s some other stipulations around that too.

Avery [00:05:47]:
Another type of loan is a DSCR loan and DSCR is, it stands for Debt Service Coverage Ratio. This is like the second most common type that we see people getting for short terms. It’s a portfolio loan, so it’s not a Fannie Mae, Freddie Mac. You can’t get these everywhere. There’s a handful of lenders in the country who will do it when it comes to short term rentals, but basically they do look at your credit score, but where they’re no longer looking at your debt to income ratio, they’re looking at what the property will make. So DSCR stands for Debt Service Coverage Ratio. Your debt service is your mortgage and they want to see that the property is going to make the same amount of money or more than what that mortgage is per month, expressed as a ratio. Usually it’s one to one, sometimes it’s a little higher, but they want to see that the property is going to make enough money to be able to cover the mortgage.

Avery [00:06:42]:
Now they’re not looking at your debt to income. You can get this straight in your llc. You, you don’t have to get it in your personal name and there’s not a limit on the number of finance properties you can have. So it sounds really, really great there. I mean, it is really great. Didn’t mean to make it sound like it’s not, but there are some things that you need to be aware of. So this is a really great type of loan for maybe if you are switching from a W2 job to a 1099 job and you don’t have two years of income to show to get a conventional loan. It’s also great if maybe you’re out of dti, maybe you’re too close on your debt to income ratio for a conventional loan, but you’ve got a down payment ready to go and, or maybe you’re out of Conventional loans.

Avery [00:07:27]:
So it can be a really great product. Typically it’s going to be 20% down and the downsize, the, the interest rate is going to be higher than a conventional loan because there it’s a risky loan for the bank to give you because they’re just betting on you, on your ability to manage it well enough to, to make that mortgage payment every month. A lot of them also have prepayment penalties of 5ish years. Not all of them, some of them have different ranges. So you want to keep that in mind. But those are the two main types of loans that we see getting done for short term rentals. So conventional and dcr. So now we’re going to get into, now we’ve given you a few vocabulary words, little quick primer, we’re going to get into the specifics of Branson because condos, specifically non warrantable condos can be a little difficult to finance.

Avery [00:08:19]:
So I’ll let Bill take it from here on that and then we’ll, we’ll ask Lynette some questions about the financing side of it.

Bill Beck [00:08:26]:
Oh, thank you Avery. I love that intro. I just learned some things. Pet peeve is when people say DSCR too it’s like no, it’s not that. One of the biggest things people need to know when they are looking to buy something at Branson is we have different lending rules here. And this is something that when I was very new I just figured okay, it’s just some whatever this non warnable thing is these banks making up their own like rules. But then the more I kept running into it and seeing it come up again and again and again, I realized this is something that is like very, very important to be aware of. So with non warrantable I’m sure Lynette can do a way better explanation of like specifically what it means.

Bill Beck [00:09:09]:
But in my opinion it just basically means with traditional lending they put it out on secondary market like with Fannie Mae and then those mortgage bodies, they’re not going to buy these loans from banks if they don’t fit certain criteria. And when there’s a lot of our vacation properties here in Branson are in these communities. Well because of the zoning, it forces everyone to buy in these communities that are all doing the same thing, which in this case is everyone’s an investor. So certain thresholds get hit as far as the number of people go in the community. And that’s one of the questions on the what’s called the condo questionnaire. So I know we’re getting into the guts of it. But, but fundamentally this is something that like you need to get with a bank that knows that they can work with a non warrenable condo. That’s the first thing I’m going to ask because I have been in nightmare situations where the bank that the client has brought to buy in Branson is two days away from closing and we’re getting questions about, hey, we still are waiting on the master insur insurance policy because we’re not sure that they have enough coverage on the building.

Bill Beck [00:10:20]:
And it’s like, wait, wait, wait, why, why is this coming out now? We’ve passed our loan deadline in the contract. So like, why you just told me the, the buyer’s good, they’re, they’re, they’re clear. But you’re saying the, the association that they’re buying in is not. And then it becomes a. Yeah, well, they don’t have enough coverage, so sorry, we can’t do the loan. And then you’re like, what? And this is like one of these things that you. They don’t, they don’t bring up until they discover it. So this whole condo questionnaire is initiated when the bank is trying to vet out this, I guess, third party as part of the transaction, which is the association.

Bill Beck [00:10:54]:
So asking things about the budget, if there’s a certain level of reserves that aren’t there, that could be a huge issue. If anyone’s got a lawsuit against the association, obviously that’s risky. So fundamentally that is why our banks are wanting to push most people into a commercial type product. And then also Simmons has this, this product that I’ve had a number of investors and people that you know are From Kansas City, St. Louis, they come out, visit however many weeks a year, and they’ll come out here and you know, also rent it on the side. So this has been a really good option for anyone so they can avoid that headache. Because that is by far the worst deal stress you will ever experience ever is when you’re at the finish line and your, your money is held hostage. And that’s something that I’ve had at least half a dozen.

Bill Beck [00:11:45]:
And it’s not, not a fun experience. It gets me real fired up and I mean, I start, I start cursing like a pirate. So.

Avery [00:11:52]:
So, Lynette, it would be super helpful if you would kind of give us a rundown on what it takes for a lender who maybe it’s a lender out of area when they see a condo building or a condo development and a buyer says, hey, this is, I want to buy something here. What’s the process that a lender has to go through to find out if something is warrantable or non warrantable because I think a lot of buyers mistaken that lenders should just like know this. It should, you should just be able to tell by looking at it and you can’t. So what’s the process that someone has to go through to find that out?

Lynette Van Gundy [00:12:25]:
Well, generally when we run into trouble is when we get the appraisal back. And most all of the units in the Branson area are non warrantable. And from what I understand that definition can vary from bank to bank. But Fannie Mae and Freddie Mac will not purchase these products because they feel like they’re a higher risk item. So some of the things that can come in to play with that non warrantable definition is new construction. That that’s usually a red flag. The developer cannot be in control of the association. One thing that I think the main thing for Fannie Mae and Freddie Mac, the reason why they won’t buy them is because there are short term rentals and that community, they have a specific limit of the number of units that have to be owner occupied.

Lynette Van Gundy [00:13:23]:
And all of these numbers are in the appraisal when it comes in. The appraiser addresses all of those issues. So when the appraisal comes in and they start reviewing the appraisal, they go, oh no, we can’t do this. As a lender especially, and I grew up in small banks and now with this, this big institution, but as a local lender that many of these borrowers might be trying to work with many of them if they’re not in the Branson area, they may not have ever heard of a non warranted condo. So they don’t even know it’s an option until they get the appraisal. And someone says, oh, you know, we can’t do this. So you know, it does vary a little bit. I did just find out yesterday.

Lynette Van Gundy [00:14:11]:
One thing that was really helpful is the Department of Housing and Urban Development actually has a list of FHA and VA approved condominiums. You can go right on their website and I just was playing with it yesterday and put in Stone County, Missouri and Taney County, Missouri and I found one that was approved, you know, on their list. And you know what Bill and I run into sometimes is people that aren’t in the area, you know, their bank at home is saying, oh yeah, you know, we can do this, no problem until you know, they get the appraisal in. And then someone says, you know, this is an issue. We do have Some specific association requirements that we look at. We do require that 51% of the units be sold and conveyed. The owners must be in control of that homeowners association. The amenities have to be complete and installed.

Lynette Van Gundy [00:15:08]:
There can be no additional phasing going on. You know, not a lot of construction going on in the project. And also, you know, part of our questionnaire is if there’s any type of, of litigation with the association or the developer. So that, that’s kind of the specific things that we look at.

Avery [00:15:26]:
Okay. And so this is kind of where we jump into the why it’s good to use a local lender argument. Because sometimes when, and I’ve done it myself when I was new and I didn’t know, tried to buy a condo in Panama City and in Florida and it was non warrantable, of course, as none of them in that area are warrantable. And I just went to my regular lender in Nashville and said, hey, can I buy this condo? And she said, yeah, may non warrantable. But you know, we’ll, we’ll, we’ll see what we can do. And then what happens is you get three weeks into the deal and the lender thinks they may be able to bang it through. Because all lenders think that like everybody wants to do the deal. Right.

Avery [00:16:05]:
There’s nothing wrong with that. Everybody wants to be able to serve their client the best they can and get the deal done. So of course everyone is going to say, well, let me try it. But what happens is you get, I’ve.

Bill Beck [00:16:15]:
Heard that so many times.

Avery [00:16:16]:
Yes.

Bill Beck [00:16:17]:
I had it, like vocalize it.

Avery [00:16:18]:
I was like, yes, let me just see. Yeah, let me, let me just see if we can do it. And what happens is you get three weeks into the deal, everybody is like ready to close because you’re getting close to closing. And they get that appraisal back and they see these things and they say, oh no, we can’t lend on it because it’s non warrantable. They take it to their higher ups and try to get it bang through and they say, no, it’s non warrantable because of X, Y and Z and we can’t do it. So guys, by having this entire conversation, we’re trying to prevent you from going down that road and being very sad at the end of your deal.

Bill Beck [00:16:50]:
I’ve had DSCR lenders too, that you know. Yeah, yes. Where they’re like, no, we’re good. We work with non warrantables. This is fine.

Avery [00:16:59]:
Oh really?

Bill Beck [00:17:00]:
They still are like, well, we, I don’t want to Say this forever to use Sarah Lenders. If. When someone’s listening out there, like that’s an exception to the rule. Like when it said every bank’s different. This is why it’s so hard to tell someone, yes, for certain that’s not going to work. Or it will. Because I’ve had DCR lenders say, yeah, the, they didn’t have enough reserves in their budget based upon the documents that we received, which I believe is a 10%. And we’re pegging that to Fannie Mae standards.

Bill Beck [00:17:28]:
And you’re like, okay, but you said this doesn’t work for non warrantable, right? Like, so what’s the big deal? And they’re like, yeah, well, I’m trying to send it up the chain and my, my boss is saying we can’t do it. And you’re like, what the heck? Like the whole point was. And then it just, it just puts this, this and this is. I’ve had multiple DCR lenders and another one was again with that insurance situation where they’re like, well, this master policy only covers for, you know, it was a six unit building and it said it only covered it for like 700,000. They’re like, well, if you, if you math up the values of each of these now, because everything’s going up to, by, you know, up to 200,000 or so, the value of this building is like 1.2 million. So there’s this insurance gap that we’re not covered and we need that to be increased otherwise we’re not going to do the loan. And you’re like all this stuff that like, I would never know. Like, this is, this is totally curveballs out of left field.

Bill Beck [00:18:20]:
I’m just a real estate agent. Like, I don’t know. These are these the, the rules behind the scenes. So that’s why I’m bringing these stories out because this is like totally real. And then you get people upset. The title company’s mad, the seller is like livid. The other agent is like, what the bill I camped. And you’re just like, ah, we’re good, man.

Bill Beck [00:18:40]:
I think just hold tight. And then you got to do this. Like, you know, okay, we might need another bank to come in. Bring. Hey, Lynette. How many times have I done that? Lynette?

Lynette Van Gundy [00:18:53]:
More than once.

Bill Beck [00:18:55]:
Yes. So this just, I bring that passionate statement because it’s like, this is by far one of the worst landmines you can step on when you’re buying something in Branson because it’s totally avoidable. You can just Say, let’s just not even like go in that dangerous territory where there’s risk. Let’s just go down this road that we know that’s good. And people just are like, they don’t listen. They just flat out don’t listen. They’re like, well, I’ve got a guy like, or a girl I like. It’s like, I don’t care if you like them.

Bill Beck [00:19:23]:
Like, do you want to go blow your leg off in this minefield? Like, come on. Like, let’s just not do that. Let’s just go with someone that you’re going to be friends with for a little bit. And then guess what? How often do you talk to your banker, right? Like you do a deal with them, but then maybe talk to them once a year anyway.

Avery [00:19:41]:
Yeah, you know what I think it is? I think people don’t like, if they’ve used somebody recently. They don’t want to have to send all their documents to somebody new because it’s a pain. But it is. When it comes to non warrantable condos, you really do have to use a local lender or at least at the very least a lender who has done a lot of deals in that market of the non warrantable condo asset class. There’s a few of them that are like regional, that might not be local in some of the markets that we work in. But anyway, so I also want to.

Bill Beck [00:20:08]:
Throw in there too, like the, the interest rate shopping has hurt me a lot because, because the people find these secondary market banks that they’re using that are using a different product that isn’t what’s going to be able to purchase something here. They get this, this, this little seed plan in their mind. Like this is, this is kind of what the range of the cost to borrow is. And then they find out like the rates are adjustable or they’re going to be, you know, we can get into that here in a second. But like that, that definitely something that’s also like a little bit striking because people will shop rates, find that out prior to what actually works in Branson. Use that as like this is the basis for what I think. Like what, like the value is for rates here. And then they find out rates locally and they’re like, oh, what the heck, like, and then that’s, it’s always something that shocks people.

Bill Beck [00:20:58]:
And I like to get that out there because it’s like, well that was never going to work in the first place. So don’t compare apples, oranges.

Avery [00:21:04]:
So yeah, well, and that happens a lot because like the big national lenders, like your rocket mortgages and your lending trades and things. You know, if you start looking at loan options online, you’re going to start getting all these targeted ads from them. And I’ve actually gone through the process with one or two of them in my buying career. And they will quote you something super low. It seems really low compared to everything else. And then I’ve seen it also blow up. I’m not saying they can’t close deals or anything, but it is a completely different beast. And it’s typically what the main bread and butter of those types of companies are primary homes.

Avery [00:21:40]:
So they’re going to catch a few investors here and there in their net that they’re casting. But the primary home market and lending is completely different. And I think that’s where people can get a little put off because these big, huge banks are advertising these super low rates. But it’s for primary homes, which is completely different product, and people get a little confused. But. So, Lynette, I want to. I want to hear from you now about the. The.

Avery [00:22:05]:
The products that you guys offer and what the loan process looks like with you guys, because it seems like I haven’t bought anything in Branson, but it seems like you guys are, since you’re local, you already know by just looking at the address of the property what you can do and what you can’t, because, you know, you do these every day.

Lynette Van Gundy [00:22:22]:
And we do maintain a list of condo associations as. As we work with them. We do maintain a list with some contact information because, you know, you do have to have the association contact information. You have to know, like Bill Ment, that master policy. You have to know who, you know, carries that. So we do kind of, you know, try to maintain a list. So when someone calls and says, you know, hey, can you do this? You know, we could look quickly and see if we can do it. The main issue we run into in our area is new development, and there is a lot of new development going on, you know, in the Branson area.

Lynette Van Gundy [00:23:00]:
And, you know, with our requirements that, the 51% of the unit, you know, being sold and conveyed, you know, the phasing being completed, the association turned over, you know, that usually when we’re talking about new construction, those are issues, you know, for us. But, you know, and one thing I did want to mention on our previous conversation, you know, when you’re talking with those realtors or those borrowers that are wanting to finance, you know, outside of the area, you know, tell. Tell them, you know, ask Your, your lender, is this an in house product? Are you planning on selling this to, you know, Freddie or Fannie? Because if they’re planning on selling it, it’s guaranteed. It’s, it’s going to blow up at the end.

Bill Beck [00:23:46]:
That’s a great point. Great point. I’ve had, I’ve had people bring lenders from out of town that did say it’s, don’t worry, it’s portfolio loan, keeping it in house, just like Lynette said, and it ends up being okay. I’m still a little nervous because I’m like, I never know what, what behind the scenes because they don’t. I mean, bankers aren’t telling real estate agents, like, here’s the secrets of what we’re doing behind the scenes. They just say things like, oh, the underwriters saying this or doing that. And you’re like, okay, cool. I know I’m not the client.

Bill Beck [00:24:15]:
I don’t have the privilege to like see what’s going on behind the scenes. Yet. We’re all kind of in this car together.

Lynette Van Gundy [00:24:21]:
So anyway, so primarily, you know, to go back to your question, Avery, you know, generally, you know, I have the initial contact, you know, with the borrower, discuss, you know, if we’re truly talking about, you know, a consumer purpose primary or secondary home and what falls into that secondary home definition. You know, Simmons bank does offer those DSCR loans, you know, through our commercial loan department, you know, do a lot of referrals, you know, back to them if, you know, what I offer doesn’t fit what they’re looking to do. We have an online. Every lender in Simmons bank has an online pre qual application. Send them, you know, that link for the pre qualification. We check credit, you know, based on the information that they provided to us, you know, we’re able to, you know, provide them with a pre qual letter. Most of the realtors, Bill, I think in this area, they want a pre qual letter before they’ll start, you know, really working, you know, with, with, with someone wanting to buy. So we try to get that, you know, quickly, you know, usually within 24 hours we can get that, you know, out to them.

Lynette Van Gundy [00:25:32]:
And then, you know, when they find the one, they get the contract, then, you know, we go back to them and start getting the documentation items and you know, verifying that, you know, it is going to for sure work. And we can usually, we can usually close a deal within 30 to 45 days, depending on the appraisal, you know, turnaround time. Right now it’s it’s pretty reasonable. You know, we did back in the peak, you know, it took three weeks to get an appraisal. So you know, that closed down or slowed down our closing times. But right now we’re turning them pretty fast.

Bill Beck [00:26:10]:
Would you be able to go into like things like term length and like, you know, fixed versus adjustable and then PMI being included or not included and like how many can you do like those things?

Lynette Van Gundy [00:26:23]:
Well, for a condominium in our area, we have a 30 year fixed rate product or we have a 15 year fixed rate product. Those are strictly for condos. That’s all they’re for. And they price according to down payment and credit score. The minimum down payment is 10.01% and we do not require mortgage insurance on that. Since we’re under the 90%, we don’t don’t have to require the mortgage insurance. There is a little bit of a pricing break if you do put down 20%. And then on our portfolio products and we also have adjustable rate mortgages, we offer a 71 ARM or a 51 ARM.

Lynette Van Gundy [00:27:08]:
Their 30 year mortgages. Again, same 10.01% down payment and then a break in the rate at 20% down payment. And again those do not require private mortgage insurance with the minimum down.

Avery [00:27:23]:
What does the debt to income need to look like to qualify for these?

Lynette Van Gundy [00:27:27]:
Generally between 42 and 45% with 45% being the max. We do have a few criteria. If you meet these criteria, we can go up to 50% but you know, generally we like to see them under, under 45% on their debt to income. Which means, you know, we’re just strictly looking at their personal income. No income on the unit itself, which you mentioned with the dscr. A lot of people want to throw that in there. They want to say, well, you know, I’m going to be renting it this many, you know, days out of, you know, the month and I’ll have this much income. But on, you know, consumer residential side, we cannot take that into consideration at all.

Avery [00:28:15]:
Gotcha Gotch. And I know you can’t quote specifically because it’s going to be different for each borrower depending on their credit score. But what are you guys seeing for interest rates at the moment? And keep in mind, people might be listening to this a year from now. So we will do a quarterly update on this at the end of the series. But as of right now, we’re in late spring 2023.

Lynette Van Gundy [00:28:38]:
Okay. Well on. And again, you know, like you mentioned, rates are very subject to, you know, down Payment and the credit score, you know, especially our best pricing is with a credit score of 740 or better. And it, we have several tiers, you know, down through there with a minimum of 640 generally with the best score. You know, right now our 30 year fixed is over 9%. So that, that’s, that’s chunky. Right now we’re seeing, seeing most people go with an adjustable rate mortgage on a second home. You know those are going to be in the low eights right now.

Bill Beck [00:29:21]:
And then also that’s no PMI in there too because I’ve had people where they do that in addition to it when they’re trying to do their numbers and it’s like well that’s not accurate. So whatever that conversion to interest rates, rate being factored in or not is something that people need to be aware of.

Lynette Van Gundy [00:29:38]:
So and the rate market is, is just, it’s the highest. I’ve seen it for years and years. You know right now with the, you know two years ago we were doing these things in the 3%. So it’s, it’s a real rate shock for a lot of, a lot of folks right now.

Avery [00:29:55]:
Well, I think we’re all a little traumatized from the real estate market two years ago. Yeah, yeah. Getting beat to death. But we made it through. We all made it through. But there’s the rates were, were it was great that the rates were so low but man was it, was it rough like getting completely trampled as an agent and, and as lenders. So many people. But you know, we’re grateful for it.

Avery [00:30:19]:
Of course I do like it a little bit slower and more manageable. I have to admit. You can actually like hear yourself think and sure you’re missing anything.

Bill Beck [00:30:26]:
Yeah, I get to analyze more like versus just being reactionary and like, like almost like someone like fending off the zombies on the, on the castle wall with like a stick just like hitting one thing that’s in front of me after another and now that that’s kind of no longer the environment we’re in, it’s like you know, in more in depth analysis and looking at what these properties are going to do for the people that are interested in getting them. So.

Avery [00:30:52]:
Yeah, well what, what have we not touched on in terms of financing in the Branson market that we probably, probably should do you get into many jumbo loans in Branson? There’s not, I think most of the inventory is below the jumbo limit. But do we do many Jumbo properties in Branson?

Lynette Van Gundy [00:31:09]:
I don’t see Many. No, I mean our pricing goes up to a loan amount of 750,000. We do have pricing above that. But you know, on our in house products generally I, I can’t think of any that I’ve done over that amount.

Avery [00:31:26]:
Right now, which I think is awesome because a lot of our listeners are like used to buying in the Smokies or in the Florida Panhandle where everything is over a million. Well, Florida Panhandled Smokies, not everything is over a million, but most things are over the jumbo limit. So I think it’ll be really refreshing for a lot of listeners to say, oh man, there’s a place I can go that nothing is over the jumbo limit.

Bill Beck [00:31:47]:
Yeah, this is, again, this market is unique in that where our property values sit. It’s. If someone is not to say that this is just a budget friendly first timer market because this is something that we do have larger options. But as far as like off the shelf something for the 2 to $300,000 price range, it’s like we have that here. And you know, if people are really getting into the numbers and they’re like, oh the, you know, I’m not getting 15,000 in cash flow a month. You’re like, well that’s never going to happen. Like, like how, how did you ever get that expectation, please. So it’s a reasonable like hey, you’re, you’re not going to be uber wealthy by picking up a two bedroom condo in Branson.

Bill Beck [00:32:32]:
But it’s like, it’s definitely not a bad thing. This is a blue chip market. This is a safe area where I, I bet, hey, you want to go buy your comparative property on some random lake with a residential loan where you may not have any operational security in terms of like your, your on the ground team because no one lives out there and there’s no tourism industry there. It’s like go right ahead if that’s the risk you want more upside. I mean this is, this is, this is what it is. So.

Avery [00:33:00]:
Yep, I agree with that. I personally don’t like trailblazing into markets where it’s not something that’s typically done. I don’t want to have to work so hard to find cleaners. I want cleaners that already know what they’re doing because they’ve done 100 other vacation rentals. But I just want ease and minimal crap to have to deal with and set up at the this point in my investing career. But other people want to trailblaze. That’s great. I don’t have the energy for that anymore.

Avery [00:33:24]:
I’m turning 35 on Friday, so don’t have the energy for all that craziness. So anyway, what else are we missing? What else do we think the listeners could benefit from hearing about financing in the Branson market?

Bill Beck [00:33:39]:
How many second home loans can you do here, Lynette?

Lynette Van Gundy [00:33:42]:
Well one, one of the things with us is with primary and secondary residences they have to be 50 miles apart. So I mean you can have a true investment property and still buy a second home, you know, in Branson but you know you’re going to have to have tax returns to support that that other unit is an investment. And then you know, we’re, we can’t do, you know, two second homes within 50 miles of one another. So that, and we’re pretty much limited to, you know, the one primary or secondary residence. If they have more than that, then they’re probably, you know, looking for one of those DSCR loans.

Avery [00:34:23]:
Gotcha. Awesome.

Bill Beck [00:34:25]:
Well, I don’t think you’ve, I guess one thing to point out too is like we, I just want to re. I mean I don’t want to sell like being a dead horse with the non warrantable like headache. It’s just I don’t want people been through it.

Avery [00:34:39]:
Yeah.

Bill Beck [00:34:40]:
Like you want to talk about triggered like just talk. Let’s talk about lending problems as a realtor Branson for this particular thing that we do. So it is one of these that again there’s no guarantee. I can’t ever say for certain someone’s bank is not going to work. It’s just I do know what does work and you know, Lynette Simmons bank, handful of other banks locally have never let me down. So it’s like why would you go ahead and try to force it just to get another, you know, tenth of a interest rate point off on your, on your price. Right. And people are shopping for that.

Bill Beck [00:35:15]:
So it’s just, just give them the heads up. And, and this is something that, because of the zoning. I will repeat it. That is what created this non warmal thing. It’s not like it’s, it’s this dangerous, awful thing. It’s just more of a. Well because our areas put all of these people in these same communities. This is what’s created this other complication.

Bill Beck [00:35:36]:
But beyond that, I mean the zoning and the banking for BRANSON that’s like 90% of it. So someone is like cool, I’m good with that. I’m good with that. We can do a deal and make it a really, really pleasant way to get started.

Avery [00:35:51]:
Awesome.

Lynette Van Gundy [00:35:52]:
Yeah, we, we do a lot of lending for people out of state. You know, and with the computer age and, you know, the online applications and the secure file transfers, you know, it’s, it’s very easy to do things for people and never see them. I mean, I probably don’t ever physically see 90% of the people that I help. It’s a very user friendly process. The title companies in the area are awesome. They do the closings by mail. So it just, everybody’s kind of designed in the area to make this as painless as possible for the, the buyers that want to come, you know, to our area.

Avery [00:36:39]:
Awesome. Well, thank you guys so much for your time. I really, really appreciate it. Lynette, if any of the listeners are interested in buying in Branson and they liked your lending vibe, how can they get ahold of you?

Lynette Van Gundy [00:36:55]:
Best way to get ahold of me is through my email, which is just, it’s Lynette VanGundyimmonsbank.

Avery [00:37:03]:
We’ll make sure to put that in the show notes too, so people can see it.

Lynette Van Gundy [00:37:05]:
So, so, and you know, I’m not terribly busy. I am the, the second lender in this market, so Honor McGuffey also works in this market and she kind of brought me over. I was a commercial lender, so I know, know a little bit about those DSCR loans that you’re talking about. And Honor brought me over here to work with her a couple years ago. So I’ve got, still got the time and looking for the, the contacts. So I’m happy to talk to anybody about anything we need to discuss.

Avery [00:37:38]:
All right, well, thanks so much. And guys, if you want to buy a condo with Bill in Branson, you can email us at agents the shorttermshop.com and we’ll get you connected. And if you just have further questions and you want to learn more about this, you can join our Facebook group. It’s called Short Term Rental, Long Term Wealth. Same title as my book. Or we have a Thursday every Thursday open office hours Zoom where you can come ask us any questions that you have. You can sign up for that@strquestions.com.