BRRRR Method Lenders
Hello BP Community,
I purchased my first rental property under a LLC last year and have been fighting to get the cash out of the property ever since. So I have worked with a few lenders in Pittsburgh at FCW, FNB, Key Bank, and Standard Bank. None have been able to help me and have completely trashed my credit inquiries after overpromising and under delivering. I am currently pulling cash out through Gauranteed Rate and would like to use this money to grow my business through fix and flip and BRRRRing properties. I am looking for a lender, broker, etc that will be able to help me get to 50+ units in the next 2.5 years.
- GPF Worldwide
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#1 Creative Real Estate Financing Contributor
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Going with a private lender over a bank is probably gong to be your best bet. Banks definitely offer the best rates, but the downside is spelled out exactly in your experience...deals fall through due to stringent and inflexible underwriting
@Anthony Martin - I'd love to chat to see if I can help. Will send you my contact info in DM.
Quote from @Robin Simon:
Going with a private lender over a bank is probably gong to be your best bet. Banks definitely offer the best rates, but the downside is spelled out exactly in your experience...deals fall through due to stringent and inflexible underwriting
Robin,
I don't have much experience with private money lenders but could you elaborate? I pay cash to buy and rehab the properties or use hard money, but to convert it to a fixed long-term debt solution is where I'm running into the issue.
- GPF Worldwide
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- http://www.gpfworldwide.com
@Anthony Martin You'll want to find a broker who specializing is non conforming/commercial loan products. These are designed to help investors scale portfolios because there aren't any cap on the # of financed properties, entity vesting is allowed, and there are no DTI constraints because it's not even calculated (neither is global cash flow). Instead, these tend to be primarily based on DSCR/FICO.
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@Anthony Martin the previous posts are correct, you need to do this through a broker instead of a bank. Once you find that broker that you work with well, establish a relationship and you will see that you deals will go smoother and faster. Good Luck!
Some HMLs offer long-term financing products, i.e. the fixed long-term debt type solution you are looking for.
If you are having trouble with banks, then that might be a good route.
It sounds like you're already working with some HMLs, so speaking with them and seeing if they offer a long-term product could be beneficial, as well as searching the Network --> Hard Money Lenders tab on BiggerPockets to expand your number of financing options.
Best,
Michael
@Anthony Martin why did those banks not want to lend on it? Did they tell you the reason they weren't able to?
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fund that flip has been agreesive in that market they have taken many of my clients out .. I am the bridge in the BRRRR and fund that flip did the refi.
I agree with Jeremy. Would love to know why. I do know that some lenders are tightening up on lending right now with their concern about a potential shift in the market but I haven't seen them stop lending all together. I highly recommend Kyle Coniker. He does a ton of really cool programs for my investors including no seasoning on refis.
I'll send you his info.
Quote from @Elise Bickel:
I agree with Jeremy. Would love to know why. I do know that some lenders are tightening up on lending right now with their concern about a potential shift in the market but I haven't seen them stop lending all together. I highly recommend Kyle Coniker. He does a ton of really cool programs for my investors including no seasoning on refis.
I'll send you his info.
Thanks Elise, I will reach out.
- GPF Worldwide
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Quote from @Jay Hinrichs:I've reached out to fund that flip but I don't think have enough experience to meet their criteria.
fund that flip has been agreesive in that market they have taken many of my clients out .. I am the bridge in the BRRRR and fund that flip did the refi.
- GPF Worldwide
- 412-728-4325
- http://www.gpfworldwide.com
Quote from @Jeremy Taggart:
@Anthony Martin why did those banks not want to lend on it? Did they tell you the reason they weren't able to?
Primarily minimum loan amount not high enough. Trying to change my purchase criteria to better align with lenders.
- GPF Worldwide
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- http://www.gpfworldwide.com
@Anthony Martin ahh yeah that's something I learned early on too so I've kind of focused on the higher loan amounts ever since. The fees as a percentage of the loan amount are a lot higher under the 100k mark and a lot of lenders tend to want to do shorter amortizations on small loans as well. I would probably talk to a mortgage broker that has access to multiple lenders you should still be able to get someone to do the refi on smaller loans regardless. Did you try S&T Bank? I just used them recently for a smaller one I think the loan amount was about 78k and it was a cash out refi.