Looking for Fix and Flip Lenders in Tampa Bay area, NO hard money
Hello,
I'm looking to develop a relationship with a local bank in the Tampa Bay area that will lend on Fix and Flip projects. I'm not looking for a hard money lender. Looking for normal points and market interest rates (1 point or less, 5-7%IR). I need the bank to be able to close deals within 3 weeks. I will flip about 6 houses in Tampa Bay area in next 12 months. Please reach out if you know any banks that may be interested.
I called 20+ and most of them are uninterested or can't close for 6+ weeks because it has to get approved by their board.
Best,
Sawyer
I don’t think this is a realistic request. The reason hard money lenders make the fees and interest they do is because banks don’t do the things you described above. If they did, there wouldn’t be a need for hard money.
@Nick C. I work with a local bank in Minneapolis, MN to flip houses and I get 1 point and 5.5% IR. We do lots of deals together in MN, they don't lend in FL. They are a local community bank and this is what I'm trying to find in Tampa Bay area. Thanks for the comment!
Those are excellent terms for sure. Tell them to bring their act down to Florida, we could bring them a lot of business!
@Sawyer Lubke there are plenty of lenders that offer fix and flip loans but with a point or less that might be a tough sell. They know you will be paying off the mortgage so they need to be compensated upfront.
@Melvin List Thanks for comment! Would you mind posting the names of the lenders or sending me a PM? That makes sense. I'm curious why multiple local banks provide the rates they do up here. I'm going to call and ask! Cheers
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@Sawyer Lubke Here is your issue.. your not local.. I too get loans from my local community bank under those terms.. and top tier borrowers can get those.. Our community banks in Oregon though do not want this business.. per se we get it simply because of a very long term relationship and substantial deposit relationship..
Most community banks charters preclude them from lending to anyone who lives out of their footprint..
I ran into this in Charleston it took me 3 years to get a local bank there to fund my deals.. even though I could an did borrow 10 mil plus a year from my bank in Oregon.. and even at that they limited me to 1 mil. only because that was the bankers limit without going to committee.
I was going to buy a home there to say I have a presence .. but as we grew with this bank they just raised my line to 2.5 million so we are good.. and now that we have 30 plus new builds started and done I have a few other local banks willing to look at us..
its the getting started that is the hard.. part.. And realizing that real estate rehab loans are not a top priority for many smaller committee banks they got burnt terribly in the GFC and they have long memories.
Buy a second home there and say your a local see how that works for you
@Jay Hinrichs Thanks for taking the time to share your personal experience with this situation type. Unfortunate, but makes sense to me. I have a house on the market for sale in St. Pete's that I recently remodeled. I think I might just keep it as a second home as you suggested. Winters in MN are getting a bit long/cold for me :)
I did talk with local banks who were willing to do fix/flip, however they were at a 6 week close minimum due to having to get approved by committee regardless of the loan amount. If I can find a bank that can close within 3 weeks then I would be willing to start building the relationship (putting in larger deposits, or some cash in a short term CD etc.)
The banks are definitely gun shy down there as they all brought up the GFC when I was trying to negotiate. Thanks again!!
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Originally posted by @Sawyer Lubke:
@Jay Hinrichs Thanks for taking the time to share your personal experience with this situation type. Unfortunate, but makes sense to me. I have a house on the market for sale in St. Pete's that I recently remodeled. I think I might just keep it as a second home as you suggested. Winters in MN are getting a bit long/cold for me :)
I did talk with local banks who were willing to do fix/flip, however they were at a 6 week close minimum due to having to get approved by committee regardless of the loan amount. If I can find a bank that can close within 3 weeks then I would be willing to start building the relationship (putting in larger deposits, or some cash in a short term CD etc.)
The banks are definitely gun shy down there as they all brought up the GFC when I was trying to negotiate. Thanks again!!
for me in Charleston I had to do 20 plus new builds 200 to 400k each before I could get a bank to touch us.. so internal cash and partners is how we did it.. sounds like to me you just have a 3 week problem and need a 3 week transactional funder or you need to just pay cash and wait the 3 weeks to get your loans in place and first draw is an advance on the asset.. that seems simple enough.. as long as you have the cash.. and when I say substantial cash deposits I am talking 7 figures . not 50k ( just sayin ) and not saying you don't have substantial cash to deposit.
@Jay Hinrichs Wow, the banks in Charleston are tough to win over! I have the internal capital to float the 3 weeks, I just don't want to make this standard practice and would prefer to just set up an identical relationship as I have in Minneapolis. I would be willing to float the 3 weeks for a period of time to develop the relationship, however I don't think the local banks can do better than 6 weeks even with a relationship due to the committee approval rules. I'm learning this will not be nearly as easy as I anticipated.
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Originally posted by @Sawyer Lubke:
@Jay Hinrichs Wow, the banks in Charleston are tough to win over! I have the internal capital to float the 3 weeks, I just don't want to make this standard practice and would prefer to just set up an identical relationship as I have in Minneapolis. I would be willing to float the 3 weeks for a period of time to develop the relationship, however I don't think the local banks can do better than 6 weeks even with a relationship due to the committee approval rules. I'm learning this will not be nearly as easy as I anticipated.
its why us HML exist.. speed … and the community banks simply cant service the needs of the flipper.. too choosy of who they will lend to.