Ability to draw (HELOC style) against our real estate equity as a portfolio?

Question

Hi all - my wife and I have been real estate investors for several years and over that time have developed significant equity across many properties.

My challenge is that the equity is siloed in a high number of properties which complicates our ability to draw against it and leverage that for operational and investment purposes.

Do you all know of banks willing to work with investors and able to underwrite at the portfolio level, rather than having to apply for and open HELOCs on a per-property basis?

Thanks!

Andrew Postell · Answer

@Simon Asselin what you are looking for is sometimes called "portfolio lending" and sometimes called a "blanket loan".  But the best course of action here is two fold:

• Visit your      local REI groups. There are many groups that meet across the      country. Some post here on the Bigger Pockets Marketplace. Many post on      meetup.com. Even facebook will have some.       Networking is always a great practice and you never know who you      might meet there and what good information they have to share. Would      certainly recommend visiting if one is close to you.  If you don't live in Washington then join all the "Washington/Seattle Real Estate Investor Groups" on Facebook and ask this question in each one.
• Calling - and then      there's this option. Which is what I had to do. I had to call about 200      lenders (no exaggeration) to learn of 4 lenders who did this and I have      some tips. First, when calling banks target the smallest most community      based banks you can first. If you have never heard of them, and they have      one location - that's a good candidate. No big, national, publicly traded      banks will do this loan type. Second, try to ask for "LINES OF      CREDIT" instead of HELOCs. I know it sounds like I'm      splitting hairs but some banks write HELOCs in their residential      department....which won't write Investment Properties. And that residential      department will often not speak to the      commercial department. So, they'll just say "sorry, we don't do      it"....not even knowing that they really do! So, if you ask for a      "line of credit on an investment property" that should get you      to the COMMERCIAL division. That's the section of the bank we want. Now,      most of these smaller banks may only have 12 employees or so. So, don't get      frustrated if they don't return your call or aren't in the office. Just      call back and be friendly. Maybe play dumb a little "I don't know if      I'm in the right place..." "I'm sorry to disturb you, you may      not be the right person for this....", etc. Maybe someone can get you      to the right person. Again, be prepared to call A LOT.

Anyways, hope that helps some with your search.

Simon Asselin · Answer

Thanks @Chris Seveney and @Andrew Postell for chiming in!

I really appreciate the suggestion to engage local RE investment groups with this question which I plan to do. Also the tips on how to navigate banks and getting routed in the right department for this type of query.

In a different post I saw another suggestion to engage any bank one is working with that has 1st position on the mortgages in the portfolio. I noticed I had several with Chase, unfortunately they discontinued their HELOC offerings since COVID... Their representative recommended I engage with JP Morgan Chase private banking / wealth advisor as they thought this would allow them to be more creative and include other assets as part of the collateral. I plan to check them out although I don't think they can be competitive for lending against equity vs alternatives like IBKR.

I will keep this thread posted as we navigate this in case others are interested.

Chris Seveney · Answer

@Simon Asselin

There are some on BP which I posted about asking this same question

Have not gotten a lot of details yet but if I do will let you know.