Hello, I am an investor with well over 10 financed properties. I focus on 1 to 4 units in the San Francisco Bay Area. Does anyone know of a lender that has market rates that will finance new purchases for me with a 30yr loan that is fixed for 10yrs or more with reasonable cap or a 15yr fixed loan with 15yr amo?
I am a top borrower with excellent credit, significant cash in bank and a portfolio with only 30% LTV.
Thanks for your help!
If the loans are $300k and above there's 5, 7 and 10 yr fixed for up to 10 more loans available with 30 yr amortization in around 6.5% range depending on the term. There may be others available that can do smaller loan amounts and 15 or 30 yr fixed out there. Your biggest issue is going to be meeting the reserve requirements for all your property (6 to 12 months PITI per property) and 25-45% down-payment depending on the portfolio loan you use.
Hi Robert, PITI won'd be a problem. Right now I'm working with a portfolio relationship lender and I'm getting 4 to 4.25% loans with 30% down, 30yr amo but only fixed for 7yrs. At these rates I'm trying to lengthen my fixed rate period to 10yrs if possible but at similar rates. My credit is in the 700's, over 6 years of portfolio PITI in cash with relatively high net worth. My average loan size is under $300k but I can bundle a bunch of refinance properties together for a cash out refinance for a bunch of properties I hold all cash with no debt. Suggestions? Maybe my current lender is best I can do. Testing the waters. I can also bring a sizable deposit relationship to the table if needed.
That's a great deal. i'd stick with it. 10 yr rates I've seen are much higher and don't make up for the extra 3 yr fixed term. For what most 10 yr rates are you can figure going adjustable 2 or three years after the fixed period and still be saving your overall interest paid over that time period.
Maybe others will chime in if they know of a better way.
Can you share who your lender is?
Thanks. I use first republic. They are a regional lender in California. Who do you recommend?
Being a finance broker in the commercial space here in CA, I would say the terms you are receiving from First Republic are really aggressive. I'm also licensed to do residential and even wholesale lender channels would not be competitive with terms you are receiving. I know of other portfolio sources that could possibly handle what you're asking and you would likely receive not only possibility of terms of 30 year am due in 10, but also fully amortized 30 year fixed loans.
However, the interest rates that you'd receive are not close to what you're getting now. They would be more in the 5s-high 6s depending on the lender. If you could stomach those rates, then it might be worth looking into.
Any fixed rates in the 4% range are fantastic. Our local lenders for investors like you are around 5%, speciality lenders are at 6%+.
Yes, I have a very good relationship with them. Done a lot of deals. How is the Ohio market? San Francisco bay area market is on fire but not many values nowadays so looking elsewhere.
FRB is top notch IMO. However, they are a little conservative thus the 70% LTV. Although 4-4.25% for a 7/1 ARM seems attractive to others, they're a little high based on our experience with them. Our loans with them are 3.0-3.05% for a 5/1 ARM with 10 year balloon and 30 year am. We were offered 3.4-3.6% for a 7/1 ARM, but we didn't take it as we didn't see the reward to pay 40-60 bps premium. Different strokes for different folks.
@Sandeep S. recently obtained several loans with them so I hope he can chime in on the interest rates. Boston Private Bank has been trying to get our business, but they just couldn't compete against FRB. I recently saw something from Opus Bank, which makes me jealous. 3.85% for a bridge loan with no pre-payment penalty. Every bank has its own niche. You might want to contact Opus Bank and see what they have to offer.
Thanks Minh. How long ago were you offered 3.4-3.6% at FRB?. That's better than they just offered me. I will give Opus a call as well. Thanks. @Sandeep... any thoughts?
It was in March of this year although we have been getting very similar offers for the last 1.5 years. Their terms are 1-month libor plus 2.25% margin with a floor rate of 2.85%. As the libor rates haven't changed much, I doubt their interest rates would fluctuate that much.
you may also want to speak with Wells Fargo's Private Banking division. They were the only bank able to meet my requirements- financing multiple rental condos in small buildings that I recently condo converted in SF. These are portfolio loans, as Freddie/Fannie have a limit on percent ownership of condos in any given bldg. amazingly they offered me 4.25% fixed for 30 years, which is exactly what I wanted as I'm holding these long term.
I also bank with FRB, but they have never offered 30 year fixed terms on portfolio. I guess WF has access to other sources of money, as it's pretty rare to get 30 year fixed portfolio.
I'm not sure how picky WF is about location, as all mine are in SF. What cities are your properties in? Are you holding them long term, or plan to sell/trade in the future anyways (where 10 years is all you need)?
* one caveat: I didn't talk to them about 10+ properties.
In my experience of looking for lenders who would work with investors having 10+ financed properties - I haven't found anyone better than FRB. I did couple of cash-out loans with them earlier in the year at 3.25% (5/1 ARM at 60%LTV). I was quoted 3.75%-4.00% from them last month for the next couple of loans I am planning to do (@Minh Le - FRB rates have gone up by about 50 bps in last ~6 months). I haven't done any long term loans with them as I generally prefer 5 year (or shorter) ARM products.
So if you do find a better product (in rate or in LTV) than FRB - please do share with us :)
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