Total Loans I Can Have At One Time

Good evening, I am hearing that you can only have 4 properties mortgaged at a time now, when it used to be 10. Is this true? If it is, what if I create an LLC and run the properties through the LLC. Any one know how to go about being able to aquire many properties?

Thanks

Edited: 06/26/2010 at 05:39AM

C. Burris

Homeowner · Shreveport, LA

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Aug 10 '08, 03:01 PM

where did you hear this in the first place, about the number of properties? Second why wouldn't you be using structure to conduct business?

Edited: 06/26/2010 at 05:39AM

Fermin G.

Real Estate Investor · Massachusetts

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Aug 10 '08, 07:00 PM

A mortage broker told me that it is a new Fannie Mae rule. What do you mean structure? Any help would be great

thanks

Edited: 06/26/2010 at 05:39AM

Michael Shadow

Multi-family Investor · Bellefonte, Pennsylvania

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Aug 10 '08, 08:49 PM

The new Fannie Mae and Freddie Mac rules limit you to 4 loans now. However these are only loans that are in their programs.

I believe you can get 4 through each. You can also check with local banks that hold their own notes, you can get as many there as they feel comfortable with.

You can also set up an entity (LLC or LLP) and get commercial loans. There are no limits there either, just as many as the bank in comfortable with.

-Michael

Edited: 06/26/2010 at 05:39AM

Fermin G.

Real Estate Investor · Massachusetts

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Aug 11 '08, 01:09 AM

Michael thanks for the response. I am new at this. If I set up an LLC an go with a commercial loan they would use my personal gaurantee I suppose?

Thanks

Fermin

Edited: 06/26/2010 at 05:39AM

Jon Holdman

Real Estate Investor · Wheat Ridge, Colorado

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Aug 11 '08, 01:25 AM

Freddie Mac, and probably Fannie Mae soon if not now, won't finance a property in an LLC at all.

Edited: 06/26/2010 at 05:39AM

Jon Holdman, Flying Phoenix LLC

Fermin G.

Real Estate Investor · Massachusetts

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Aug 12 '08, 06:13 PM

I guess right now I do not have to worry about it because I have my home, one ren to own property and one I am rehabilitating right now. I plan on working my way into more than 10 properties in the next two years, if FMAE and FMAC do not finance more than 4 and banks will not finance a property in an LLC what have you guys been doing for financing?

Thanks

Edited: 06/26/2010 at 05:40AM

Chris OToole

Real Estate Investor · Bayou Vista, Texas

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Aug 15 '08, 05:17 AM

I think everone is scared right now. Wait until property values start to level off and things will change. I have one that I am financing now but an going to start to look for owner finance oportunities.

Edited: 06/26/2010 at 05:41AM

Gary Moore

Real Estate Investor · Anchorage, Alaska

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Aug 15 '08, 06:36 AM

Originally posted by Wheatie

Freddie Mac, and probably Fannie Mae soon if not now, won't finance a property in an LLC at all.

That is not the case for their commercial programs, which they both have.

My apartments in Spokane are financed with a Freddie Mac commercial loan serviced by BoA.

Edited: 06/26/2010 at 05:41AM

Jason Phillips

· Memphis, Tennessee

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Aug 19 '08, 01:04 AM

Find a local community bank that works with real estate investors as they can hold the loan in house under the LLC. these type of loans generally require a persoanal gurantee but it will not show up on your persoanl credit report

Edited: 06/26/2010 at 05:43AM

Jeffrey K.

Real Estate Investor · Milwaukee, Wisconsin

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May 24 '10, 11:57 AM

Is the loan limit back up to 10?

Edited: 06/26/2010 at 12:56PM

Brian Levredge

SFR Investor · Long Beach, California

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May 24 '10, 12:04 PM

Originally posted by Jeffrey Koenig

Is the loan limit back up to 10?

Yes it is, but with conditions. For more than four properties you need 6 months reserves per property, a 720 FICO or higher, and two years of tax returns for your existing props. They changed it back to ten about a year ago and I haven't paid attention to the guidelines since then but I'm pretty sure that's what they were.

Edited: 06/26/2010 at 12:56PM

Jeffrey K.

Real Estate Investor · Milwaukee, Wisconsin

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May 24 '10, 09:32 PM

Thats what I thought. My mortage guy at our local bank still thinks it is four, but he is a commercial guy so I will give him a break.

Edited: 06/26/2010 at 12:56PM

Curt Davis

Wholesaler · Memphis, Tennessee

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May 24 '10, 10:02 PM

Keep in mind, though they have changed the rules back to 10 properties, you will still find most banks only doing 4 b/c that is what they feel comfortable.

Edited: 06/26/2010 at 12:56PM by Moderator

Curt Davis, buyMemphisnow.com
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J Scott

Real Estate Investor · Atlanta, Georgia

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May 24 '10, 10:15 PM

Nothing much to add except to reiterate what Curt said...

Banks need to be confident that they can sell the loans to Fannie/Freddie, so they will be very conservative with respect to doing any more than 4 loans, even though technically it's allowed.

It's just like FHA waiving their 90-day rule, but most banks still not wanting to underwrite FHA in less than 90 days...it's just a conservative mindset to ensure they don't get stuck holding the loan long-term.

Search around, and you'll find a lender who can do more than 4...

Edited: 06/26/2010 at 12:56PM

J Scott, Lish Properties, LLC
Telephone: 770-906-6358
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http://www.123flip.com

Curt Davis

Wholesaler · Memphis, Tennessee

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May 25 '10, 02:02 AM

Keep in mind, though they have changed the rules back to 10 properties, you will still find most banks only doing 4 b/c that is what they feel comfortable.

If anyone is interested in buying homes in Memphis TN, I have private owner financing available that is non recourse, no limit to how many homes you want to buy or currently own, everyone is approved with the required down payment. Best part is the homes will be paid off in 5-7yrs with our program.

Memphis anyone?

Curt Davis, buyMemphisnow.com
E-Mail: crtdavis@gmail.com
Telephone: 901-881-0552
Website: http://www.buymemphisnow.com
Full Service Real Estate Investing in Memphis TN

Terica K.

Real Estate Consultant · Los Angeles, California

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May 25 '10, 01:52 PM

Banks are doing 4+ find a correspondent lender that is selling direct to fannie mae and they do not have any overlays.

Edited: 06/26/2010 at 12:57PM