Should I look for financing local to me or to the property?

5 Replies

I am looking to buy out-of-state buy and hold deals. Is it better to look for financing at local banks near where I live, or where I'm planning to buy the properties?

Thanks in advance for any advice!

Hi Marc: I'm looking into buying property is a state 1,000 miles from my home and found that my local lenders are not interested in lending outside their "home" areas. So, I'm contacting lenders in the area where the property is located. If you're using a real estate agent, s/he should be able to recommend some lenders who work with investors.

Banks will have generally a 30 mile lending area requirement, that's why the have branches to extend their ability to do business. You can ask your bank as they may have affiliate banks they work with, some banking corporations are in other states.

But, you loan will be from a lender nearest the property financed.

It's probably a good thing to have your bank, if you have a good relationship, to contact any bank you select there an offer to send verifications, ahead of requests making contact so the lending bank has a point of contact for inquiries. It's just a good idea showing you're on top of your request in a new bank.

Don't forget brokers in that area as well, but again, stay away from up front fees. :)

@Bill Gulley thanks for the info! I'll check with my local bank as well to see if they have any connections.

All above is true, but there are also a lot of lenders who are area agnostic, licensed in several states, and who specialize in lending out-of-area/state. If you plan to invest in multiple areas, it may make sense to have a single point of contact to cover all of those areas.

I have no experience with them, but one example is Ridge Lending: http://www.ridgelending.com/

With that said, I've had the best luck getting local referrals from my RE agent.