Hi guys, so i was hoping someone could point me in the right direction with financing. Ive got about $10k saved and Im looking into purchasing a $35,000 townhome to use as a rental. I went and talked to a national bank last week about financing the rest but it was only bad news from them. I got the feeling they didnt really want to be involved with something that cheap. So i thought i would turn here and ask what banks locally (Savannah Ga area) you guys have used and which one i should go talk to. I know a guy that is a private money lender, but i dont want to be in a situation where im having to pay him high returns for an extended period of time because i cant refinance with a bank.
35k is low, and National banks and mortgage brokers selling on the market will usually not touch mortgages under 50k. What you are going to be looking for are "portfolio lending" where the bank itself holds the note. This will usually happen after you have built a relationship with the bank.
The other way with a regular bank is a HELOC or Home Equity Line of Credit. Jeannie at Ameris Bank on Stevenson Ave. will be more than happy to help you AFTER you have purchased the property... That means you'll have to come up with the 35k, and then the HELOC will get you about 70% of the 35k.
This is where LIMA One capital, Dominion Financial, and these other "non-conventional" lenders come in. They are hedgefunds or similar that need to get 8-12% returns on their money. If you have good credit, some cash in the bank, they will be more than happy to lend. Be careful of the hidden fees, and you should never have to pay a deposit before you access the loan.
I hope this helps!
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