finding small loan company for property purchase.
I am looking to purchase a condo in my area, but the cost is $60k. I am having a hard time finding a loan company that will take on a small amount. Any suggestions on loan companies that might deal with low price point loans?
#1 Creative Real Estate Financing Contributor
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- Austin, TX
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#1 Creative Real Estate Financing Contributor
- Lender
- Austin, TX
Its very hard to make the economics work as a lender at such a low amount, have you considered private money or an individual looking to deploy capital? I would also check out the Creative Financing board and exploring some of those options/ideas
@Benjamin Brookes, is it for your personal residence or investment purposes? If investment, I'd follow @Robin Simon's advice.
The further below 100k purchase price, the harder it is to find a company interested in funding the deal. Are you planning on doing repairs on this property? I'm assuming you're looking for a long term rental loan for this property
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Lender
- The Trinity Company, LLC
Yes, this is for an investment long term property, no real repairs needed except for some cosmetics.
Quote from @Benjamin Brookes:
Yes, this is for an investment long term property, no real repairs needed except for some cosmetics.
Private investors/lenders are the way to go. Check your local REIAs and networking groups.
I honestly don't know if anyone would be able to hit the APOR requirements after the condo and investment property hit were both factored in. Hopefully you're putting 25% down to make the condo hit go away.
Get a referral from the listing agent. If she wants a commission check, she should have one.
I have had good luck from Nima Rezvan as a senior mortgage broker (203)913-6016
Nimaloans.com
Our min is $75K loan amount. Hard to get lender to look at deals under $100k. mIght be able to find a local one-off person. Sometimes our borrowers pull equity from another property to fund deals that dont fit the lending box
As a private lender myself, this is something we routinely fund in my markets because of this lower asset levels. Depending on what state, I may know a private lender in that market. I am the coauthor for BiggerPockets private lending book, Lend to Live. I mention this because the book can be a blueprint for you to build your own army of private lenders. I work with an active investor in this type of market to help her build this private lender army to fund all her deals. She routinely gets loans for $20k to $50k for her acquisitions, and then after she has enough, she refin's into a portfolio loan with several properties, and then starts again. There are ways! Feel free to send me a message if you have questions, but in case you are interested in learning more about the private lending process here is a link to the book: https://store.biggerpockets.co...
I have done what @Alex Breshears mentioned. I live in WV and my market has really low values. Most of my purchase prices are under $50k and usually need about $10k to $20k of rehab. I've been investing for about 6 years in that market, and over time I've built a network that wants to work with me. My first lender was actually an attorney that saw me close a bunch of these loans with friends and family money, so he lent me $50k on a property. He earns some income, I get to purchase the property and run it as a rental. I now have about 10 people who act as lenders for me, and I've had private loans for a few years because I always pay my lenders on time and consistently. They like the monthly money without having to own a rental themselves. It is a business model that takes some work upfront, but it really keeps me from having to deal with underwriters and loan requirements that don't fit where I invest.