Getting Portfolio Lenders in another State

5 Replies

Ive come across a situation where it looks as if most portfolio lenders are only interested in doing business with me only if I live locally in the area. Most also will allow me to use their services if I have a business partner in the area. My question is.

How would I be able to structure a deal like this, where I am finding the deals myself, buying all cash and doing the repairs. If I were to get a partner in the area how would I compensate them for being a stand in guy/gal. It looks as if most portfolio lenders would need them to also guarantee the loan even if my credit and income are excellent.

I have found a few portfolio lenders that will work with me but again they are very few. In order to expand and acquire more properties I need to be utilizing multiple financial institutions to reach my goals. Correct me if I am wrong.

Is there a way around this? Also is there a way for me to actually be local in another state such as a virtual office or company registration in that state?

What strategies are out of state investors using today to accomplish this?

You can offer to compensate someone to be your "credit partner."  In essence, they get the loan in their name, and you do the rest (including providing the downpayment funds).

Compensation can range from a one-time cash fee to equity in the deal, or anything in between...

Originally posted by @J Scott:

You can offer to compensate someone to be your "credit partner."  In essence, they get the loan in their name, and you do the rest (including providing the downpayment funds).

Compensation can range from a one-time cash fee to equity in the deal, or anything in between...

How much would be fair to compensate my credit partner for a one-time cash deal or equity if that is the way to go? Also should this person have a fair amount of knowledge of real-estate investment or can it be anyone.

Originally posted by @Geoffrey Jones :
Originally posted by @J Scott:

You can offer to compensate someone to be your "credit partner."  In essence, they get the loan in their name, and you do the rest (including providing the downpayment funds).

Compensation can range from a one-time cash fee to equity in the deal, or anything in between...

How much would be fair to compensate my credit partner for a one-time cash deal or equity if that is the way to go? Also should this person have a fair amount of knowledge of real-estate investment or can it be anyone.

 It depends on how much he trusts you and how much he values his credit.  Personally, I'd put a VERY high price tag on putting my credit at risk...but others may have different risk thresholds for that.

[email protected] Scott.

Ive only so far been able to only find local community banks but what about portfolio lenders that are nation wide. Do any exist or do they most always need to be local to the city where I am buying? 

Interesting solution to a fairly common problem. It seems risk could be reduced a bit if both parties are experienced in their local area and are using LLC's or a legal agreement. I've run into this with private money as well.

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