Bank suggestions for unsecured LoC?

Question

Hi all, I'm on the hunt for a good bank open an unsecured line of credit with. I've called around to a few already and the standard reply I've been getting is that they cap their credit limits at half of the borrower's liquid assets value; nothing to do with income. I'm just getting started (only have one rental at the moment) and have little in liquid assets.

I'm fortunate enough to have a good income though, so I'm trying to find someone that will approve me for a good sized LoC based on my personal income and credit score/history, as opposed to only my liquidity. Any suggestions?

Account Closed · Answer

@Matthew Nicklin thanks for the info man, I may reach out to Regions then.

I'm trying to get one to use for any combination of down payment and/or rehab expenses; just whatever I need capital for at any moment that exceeds my cash savings. I'd much prefer to get a HELOC or something similar as you mentioned, but I only have one rental at the moment and it has only ~15% equity, so not much collateral to offer unfortunately.

Account Closed I wouldn't have expected to hear that about a big bank like WF but I'll give them a shot. Thanks for the tip!

Account Closed · Answer

For a different company that I own, I have a $100k signature line of credit from Synovus. It is in MY personal name and is solely based on my personal credit score and income. However, it is listed as a "business" account so it does not hit my personal credit report at all. They were VERY SPECIFIC that "at this time" they are not reporting it onto my Credit Report but "at any time in the future" they may start without any warning to me.

If that meets your need you may want to reach out to them. They may not have the slick web site and the cool app that some of the big banks do but they sure have been easy to work with...at least that has been my experience.

Good Luck!

--T

If that meets your need you may want to reach out to them.  They may not have the slick web site and the cool app that some of the big banks do but they sure have been easy to work with...at least that has been my experience.

Good Luck!

--T

Account Closed · Answer

Account Closed sorry, man.  I am not really sure what the criteria was for me but I can tell you at that time my liquidity was virtually non-existant.  I had three years of tax returns showing good income but virtually nothing in liquid assets.

One point to consider from your final post, however, is you mentioned "to use for any combination of down payment and/or rehab expenses" and the first part of that could be trouble.  I am not an expert but I am pretty sure that any bank or fund loaning money (even hard money) is going to require you to have the down payment as an asset and not a liability.  Of course, you would want to confirm that with your lender but I have never heard of any kind of bank allowing you to borrow the down payment.

Hope that helps!  Good Luck!

--T

Eamonn McElroy · Answer

Account Closed

The interest rate is reasonable and only costs $25 annually.  My only pet peeve is that you can't connect non-Wells Fargo accounts for online transfers (last time I checked).

Matthew Nicklin · Answer

Account Closed I guess it all depends on what you consider a good sized LoC. I know another investor who has an unsecured line at United Community Bank for $50K, but when I called they would only give me a line if I opened a CD with them for the same amount.... A lot of this is going to be relationship based if you have other accounts and services with the institution you are more likely to get a higher line or better terms. I know Regions Bank told me they would give me a line for 2X Gross monthly income, that seemed to be their going line amount for unsecured.

Are you trying to use this line to obtain property or just to have a line open for repairs/large expenses? If you are using it to try and obtain property you are probably better off trying to get a secured line as the rates will be better etc.

Nicholas LaGatta · Answer

For all their many many shortcomings, I got a personal and business unsecured LOC from Wells Fargo, combined $50k @~10%, easier than applying for a car loan.  I'm not sure their criteria exactly, but stop in with a banker.

Mike Dymski · Answer

I'm with Account Closed.  Synovous has unsecured LOCs up to $250k with a 3 page loan document and no "closing".

Joe Cassandra · Answer

@Anthony Morgan FYI, you'll find most HML dont care where your down payment comes from as long as it is green.

Banks, you would have to season it for 3 months.

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We are looking for a good LOC as well. Wells Fargo hands out LOC but they only can increase your line in small increments unfortunately.

Bank suggestions for unsecured LoC?

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