Updated over 6 years ago on . Most recent reply
Looking at / Portfolio Loan Option
Hello, I love BP and am leaning on you as readers with experience to help us make good decisions on portfolio loans in general. I am re-posting this question - Evidently I was asking for loan providers and opinions of people without experience. To be clear...
I am looking at putting several of our rental properties in a 30 year fixed portfolio loan. I am looking for anyone who currently has a portfolio loan and what they have to offer in respect to things to look for or look out for. If you have a portfolio loan on more than 5 - or more properties, and have any thing to help with this decision process while we are reviewing lenders, like what out for... unfavorable terms, hidden charges, prepayment penalty clauses, or bad experiences please reply to this post.
I am not looking for companies or individuals who have products to offer or information on situations you have not had personal experience with. Please start with How many properties are in your portfolio loan. Then the experience you had with your loan. Since this is my first time with this type of loan, I am sure others can learn from your experience also.
We want to keep all our properties in our LLC for insurance and asset protection reasons. Please do not post any specific company information. You can PM me if you want to share a great or horrible experience with a specific company.
Thank you,
Mike
Most Popular Reply
On our existing one, we have 6 units all on one loan. 20% down and 4.5% interest locked for 10 years and amortized over 25 years. I think closing was about $1500 plus appraisal fees. After the 1 years the most it can adjust is 1% per year for a max adjust of 6%. These rates were about 2 years ago. The rate on the same product now is 5.375 with the same terms.
We were just able to set up a line of credit on them with out having to re-appraise them (they used the figures from 2 years ago) at 80% LTV between the remaining loan and line of credit put together.
The advantage of having them al together is just the case we just did.... the unit together had about 50K of usable equity, whereas each one on their own would not have been much and had extra cost to set up multiple lines of credit. We are able to sell of a unit as long as the LTV on the remaining ones stays at 80% or better.
My advice is to find a small lender where both the loan officers and board members are ALSO real estate investors... it has made it SO smooth.