I am buying and rehabbing a property in Davenport, IA. It is not in a condition for bank financing right now, but will be fully remodeled after purchase. It is being bought with cash, and after the remodel I would like to cash-out refinance with a fixed rate. I'm looking for banks that lend in that area to an LLC. Does anyone have any recommendations? I've heard outstanding things about the banking industry in the region, but being so far removed it's hard to know who to approach.
Realize that most lenders will value the property at your purchase price plus rehab costs and not the fair market value within the first year of your ownership.
Hi Bryan, I live in Davenport area. Haven't done my first deal yet but have been calling around a few different places to see financing options in anticipation of that. It seems pretty standard around here that most banks are doing a 5 year balloon. Some will only amortize up to 20 years with some up to 25 and some 30. Every place will either finance up to 75% LTV or 80%. Seeing rates from 4-5.5%. Hope that helps, and I can pass on some lender names if those terms are at all what you are looking for. If you or anyone else finds a lender willing to do more than 5 year balloon I would definitely be interested in hearing about it.
@Darren Eady It seems that with the commercial loans each bank handles it differently. I've had 4 different seasoning periods quoted so far: 0, 3, 6, and 12 months. The low seasoning loans were all 3-7 year balloons. While interest rates are through the floor I want to lock them in.
@Justin Hawker Thank you for the feedback, and welcome to BP! You're right with those numbers. I'm really after the needle in the haystack. I know it exists, but I haven't found one that lends in that state yet. I'll ping you if I hear anything.
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