Hi awesome BP members,
I bought one single family home with cash last 6 months ago. Now I am in the process of buying another one with 20% down payment traditional convention loan with 6% interest 20 years term with a local bank. I think the interest rate is too much and I want 30 years fixed but this bank does not offer such loans. So I am looking for lenders/ banks with low interest rate with 30 years fixed loan. I prefer local or face to face meetings not over the phone conversations. I am buying properties for Buy & Hold. I am planning buying 2 or 3 properties every year. Please let me know if you or anyone has any recommendation for local banks/ lenders in DFW Texas.
Thanks in advance,
If you have strong FICO then that rate is too high and term length too low.
While I understand your desire for a face to face interaction I wouldn't rule out the possibility of an out of state provider offering better terms as long as you can build trust and do some due diligence like sorting through references.
Alex, thanks for your reply.
I've got good FICO score and good credit standing. Yes, it is what I thought so.
I prefer local since I want to meet in person. But I will take your contact info for now.
@Ryan Blake Thanks for the recommendation.
@Sut Sinpraw thanks for posting this. Bigger Pockets also has a very active Texas forum too if you ever want to get some more local advice. The loan you are getting sounds like a "portfolio/commercial" style loan. Those loans are really easy to get...but you are correct that they will have different terms than a Fannie/Freddie type of loan. Do you know if you can qualify for a traditional Fannie Mae or Freddie Mac loan?
Conventional - I'll define these as loans that come from Fannie Mae and Freddie Mac (if you recognize those names) but in actuallity conventional loans are ALL loans that are not FHA/VA loans. So the term is pretty encompassing. So let's just stick to Fannie/Freddie for now. These loans are all 30 year fixed rate loans. They have the lowest rates we can find and since they are 30 year fixed...they allow us to cash flow better...which helps us qualify for other loans later. The draw back to these loans is that they are more paperwork heavy than the other "portfolio" types of loans....but if you have ever received a loan on your primary home, it's likely that you will go through the same type of paperwork here with conventional lending. Fannie/Freddie money = Fannie/Freddie rules. NOT the bank's own money.
Portfolio - I'll define these loans as loans that come from the bank's own "portfolio" of money. Sometimes referred to as "commercial" loans. These loans are a lot more flexible than "conventional" loans. Bank's money = Bank's rules. If they like you, then maybe they will lend to you. But since there is a limit to how much money the bank has access to....their rate will be higher...and usually a shorter term. The most common portfolio style loan in Texas is a 20 year adjustable rate loan. These loans are easier to get but the terms are different.
Fannie/Freddie types of loans will be available everywhere and those rules might change SLIGHTLY between lenders. Portfolio loans can run the gambit. Since each lender controls it’s own money you will have to call around to ALL the banks to learn about all the programs.
Anyway, hope that some of this helps in some way. Feel free to post anything else. Thanks!
@Andrew Postell Thanks for your clarification. Yes, the one I got the loan right now is commercial loan 6% with 20 years term. I have been looking for conventional loan with 30 years fixed. For sure, I will call around all local banks in my area. Your post did help me understand more. Thank you.
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