Commercial/blanket/portfolio Loans that Don't require Appraisal?

7 Replies

Hi, I currently own 12 properties.  4 have traditional mortgages on them and 3 of them are lumped together on a commercial portfolio loan.  All of these loans have required appraisals of course.  

Thus, I have 5 properties currently that are owned outright with no loan.   My cash flow is drying up and I need to get more cash.  All of these properties are rented but most in bad shape and in need of significant renovations, which I will eventually do but not ready to do at the current time.

Is there any type of loans out there that I could get given my situation that wouldn't require an onsite appraisal?  Like anything that would use rental income or just a desktop appraisal?  Any ideas would be great.  I am in NC..  Thanks!

No bank is gonna loan you a penny under those conditions and most hard money lenders would probably take a pass as well.Only a private lender( millionaire) might be willing to help for a huge interest rate that will make you cry.What do you want the cash for exactly,it makes a difference.My advice since you have 5 free and clear properties is too to sell the 3 worse ones for whatever cash you can get and invest it in repairing the best two into modern top of the line properties charging premium rent and maximizing the ARV.

I want to have more cash to buy more properties.  I definitely won't be selling anything as all the properties I have had to work to find via private sellers/off market and are in great areas and will dramatically increase in value.  I have the funds to rehab them but don't want to since they already have tenants living in them.  I would rather go as long as possible with the current tenants before doing the full rehab.

Maybe I should just do appraisals and find another commerical/portfolio lender that lets me put a bunch of them into a single loan again.

@Aaron Smith ,

This is definitely a pretty specific scenario, and I think the Appraisals issue (and finding a Lender that won't require them) will actually be the biggest deal breaker.

However, I don't think I'd let that stop you from investigating a specific Lender's options, since even if the properties will appraise for well under their fair-market ARV, a Private Hard Money Lender might be willing to work with you.

We've even seen deals in hot markets get funded at >100% of the Purchase Price or As Is Value, based on a higher ARV & knowledgeable Borrower that still inspire confidence in everyone seeing a healthy profit.

Your biggest assets will be the free & clear properties, and the existing rental income.

The biggest potential issue I could see would be if your existing debts will require too much to pay off with the new Blanket Portfolio Loan, that you end up with not much cash-in-hand after paying everything else off.

It's an interesting question & scenario, so I'm happy to discuss further. Feel free to connect with me on here to reach me directly via any of the contact info in my signature.

Thanks!

Originally posted by @Aaron Smith :

Is there any type of loans out there that I could get given my situation that wouldn't require an onsite appraisal?  Like anything that would use rental income or just a desktop appraisal?  Any ideas would be great.  I am in NC..  Thanks!

 I'm in a similar situation like you, and there are options out there for you.

Just out of curiosity did you cashout?

Originally posted by @Joe Bruck :
Originally posted by @Aaron Smith:

Is there any type of loans out there that I could get given my situation that wouldn't require an onsite appraisal?  Like anything that would use rental income or just a desktop appraisal?  Any ideas would be great.  I am in NC..  Thanks!

 I'm in a similar situation like you, and there are options out there for you.

Just out of curiosity did you cashout?

I actually have done about 5 more loans since I wrote this, and they were 4 more conventional loans and then a portfolio cash out refi on 4 properties together.  I had to get appraisals on all of them.  I never found a workaround, but it wasn't a big deal.

@Aaron Smith - what was the profile of the properties they appraised (SFRs, residential multifamily, commercial multifamily)? And what was the primary valuation method? Did they take into account each property’s specific cash flow profile and use comparable cap rates to value (on the residential properties specifically)?