My concern lies in being able to make offers fast.
So my broad goal is to find and rehab properties to rent out, then refinance to get my cash and new equity out after 6 months. I want to grow a rental portfolio with all properties ultimately in traditional mortgages.
I'm not sure what type of lender I'll ultimately go with, and am learning more about each. I understand I'll need a pre-approval document from a lender to make any offers on any deals.
Do I only obtain this from the lender once I bring them a deal I've structured?
Or can I get a more universal, conditional pre-approval letter beforehand so I can make an offer quicker?
How does this typically differ with each type of lender?
Thanks in advance.
Yes it differs but you can often get a letter of intent to lend from a hard money lender.
@Jonathan Studdard ...I sat down with a lender (private) and they wanted you to have your own funds...amount specific...before they start working with you to help fund a deal. But check around with the ones who'll meet with you. They're all different. And it depends on the deal too. I recently had a lender said he'd fund the deal if I can keep the rehab at a specific amount. So keep at it and good luck, you can do this!
@Jonathan Studdard most lenders will give you some type of letter. The sellers usually require a letter or a "proof of funds" letter. I've seen hard money lenders give a proof of funds letter too. I've also seen hard money lenders require your preapproval letter from your conventional lender so they know you can refinance out. Should be pretty common since the lenders know you can't really make offers without them. The letters are usually good for 90-120 days. Thanks!
Most HMLs are transactional, so they may want to pre-approval you and the deal ahead of time before providing a POF. There are some that can provide a letter stating that borrower is approved to borrow up to X amount after you go through the pre-approval process with them (application and some documents). It's not a bad idea to get pre-approved with a lender (if they allow it) because then you can close faster on your next deal.
I'll PM you a recommendation.
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