Are Portfolio Loans Counted in Loans #1-10?

Question

Hi everyone! Two quick questions,

I have a conventional loan on my primary residence and one on my first deal.
1. Does the loan on my primary count towards the 10 loans?

For my next few deals I'm using a portfolio lender for various reasons and the terms are 5/1ARM 30 yr amort. I want to be able to get conventional loans later down the line on other properties or even to refi these portfolio loans.
2. Do FNMA/FMAC guidelines consider my portfolio loans in the count of loans 1-10? Or does it mean 10 conventional loans on their own?

Thanks in advance

Steve L. · Answer

Question 1, is a simple Yes, that will count.

Question 2, opinions really differ on this.  Some lenders say 10 financed properties is the maximum.  Some lenders say 10 properties financed and reporting on your credit.  Once you own many properties most lenders don't want to touch your file (it's a lot of work as they have to enter every property by hand).

If the portfolio lender will loan directly to your entity it shouldn't count and would not report on your credit.

FYI, Frannie/Freddi will loan on a primary residence no matter how many properties you own/have financed.

Mehran K. · Answer

Thank you Sahn.

Also, thanks Steve L. for the detailed response that I can tell comes from experience. Exactly the answer I was hoping to hear. I may need to consider forming an LLC instead of buying under my name even more now.

I wonder if loans will be reported to the credit bureaus If I have to personally guarantee the loans.

Sahn L. · Answer

I just spoke to Wells Fargo about this very question recently. Yes, your primary residence counts as one of the 10.