Investor · Houston, TX · Member since 2015 · 2 posts · 0 votes
Mot asking for a loan or specific lender, but I'm really asking how this type of situation is handled.
All the traditional banks I've talked to won't lend to you if you have 10+ mortgages.
All the hard money lenders offer loans for short turn around with high interest rates.
How do I get a loan for a long term buy and hold rental property when I already have 10 rental properties financed?
I have good credit, good cash flow, and tons of value in the equity in different properties held; but I don't have enough cash to buy the property I want without a loan. I keep running into dead ends and I don't know how to move forward.
Anyone who can give advise will be greatly appreciated.
Mot asking for a loan or specific lender, but I'm really asking how this type of situation is handled.
All the traditional banks I've talked to won't lend to you if you have 10+ mortgages.
All the hard money lenders offer loans for short turn around with high interest rates.
How do I get a loan for a long term buy and hold rental property when I already have 10 rental properties financed?
I have good credit, good cash flow, and tons of value in the equity in different properties held; but I don't have enough cash to buy the property I want without a loan. I keep running into dead ends and I don't know how to move forward.
Anyone who can give advise will be greatly appreciated.
Casey,
I've acquired 1,000 apartment units so it's possible to go way beyond the 10-loan limit. Here are 3 ways to do it:
Look for a commercial lender or portfolio lender. The 10-loan limit is for conventional mortgage loans. With a commercial lender or lenders who keep loans in their portfolio, there is no 10-loan limit. With a commercial lender, you need to put up an LLC or corporation and borrow money and take title into an LLC or corporation.
Do a 1031 exchange - exchange the equity in your 2-3 properties (sell them) and buy a bigger property (more expensive and/or higher loan amount). The loans on your 2-3 properties you sell get removed from your credit.
This is my favorite. Raise PRIVATE MONEY. Since you've bought 10 houses with equity and positive cashflow, you now have a track record of success so talk about your experience. Network both online and offline and you will attract private money. You can tell people they can use their Roth IRA - get it self-directed and it can lend you money so you can buy real estate. There are a lot of retireees who put their money in CDs earning 1% or less and they will be more than happy to lend their money at 5% secured or collateralized by houses you can buy at a discount.
At this point you need to consolidate some loans into a commercial or portfolio loan (in house). Have any of the banks you talked to mentioned that kind of product? A small business plan showing the cash-flow, equity, and financing you're searching for could go a long way. Conventional and FHA loans would be off the table in my mind.
Banks have not mentioned a portfolio loan to me. Sounds like this would be though the business loan department rather than the mortgage department. I haven't gotten any business loans yet, only home loans.
Mot asking for a loan or specific lender, but I'm really asking how this type of situation is handled.
All the traditional banks I've talked to won't lend to you if you have 10+ mortgages.
All the hard money lenders offer loans for short turn around with high interest rates.
How do I get a loan for a long term buy and hold rental property when I already have 10 rental properties financed?
I have good credit, good cash flow, and tons of value in the equity in different properties held; but I don't have enough cash to buy the property I want without a loan. I keep running into dead ends and I don't know how to move forward.
Anyone who can give advise will be greatly appreciated.
Casey,
I've acquired 1,000 apartment units so it's possible to go way beyond the 10-loan limit. Here are 3 ways to do it:
Look for a commercial lender or portfolio lender. The 10-loan limit is for conventional mortgage loans. With a commercial lender or lenders who keep loans in their portfolio, there is no 10-loan limit. With a commercial lender, you need to put up an LLC or corporation and borrow money and take title into an LLC or corporation.
Do a 1031 exchange - exchange the equity in your 2-3 properties (sell them) and buy a bigger property (more expensive and/or higher loan amount). The loans on your 2-3 properties you sell get removed from your credit.
This is my favorite. Raise PRIVATE MONEY. Since you've bought 10 houses with equity and positive cashflow, you now have a track record of success so talk about your experience. Network both online and offline and you will attract private money. You can tell people they can use their Roth IRA - get it self-directed and it can lend you money so you can buy real estate. There are a lot of retireees who put their money in CDs earning 1% or less and they will be more than happy to lend their money at 5% secured or collateralized by houses you can buy at a discount.
Sounds like you're talking to the wrong traditional banks. If they are selling their loans to the secondary market, you won't have a lot of luck. You need to find the smaller banks that service their own loans.