All Forum Posts by: Mary Aviles

@Matt Nico  I used Finance of America Commercial.  They are a nationwide lender. PM me with your location, and I'll have my agent find your closest office.

@Nghi Le I guess I disagree that commercial lenders require as much documentation as conventional. Every commercial loan I've used required almost no documentation. All they ever ask for is to fill out their application, and if you're closing in your entity,  the operating agreement.  Then they pull my credit and order the appraisal.  That's it - no PFS, no tax returns, nothing.

I closed on one loan with Finance of America on Wednesday and I'm waiting to close on another one on Monday. Quick, easy, very low fees, great rates, great service. The quote of 5% was for a 75% LTV, but I did a buydown to 4.75%. My appraisal ended up at 60-65% LTV, but the rates would have been the same. I think you missed one of the fees I mentioned above:1% of the loan plus $795 application fee. But that's it for lender fees; this is pretty good. The 1% buydown points are optional. They have a 5 year step-down prepayment penalty, which is very acceptable.

@Daniel Smyth  Please don't be THAT landlord (slumlord). It's situations like yours that give us legitimate landlords a bad name. Just this week in Cook County they passed an ordinance outlining responsibilities for landlords and tenants because of the many shady things slumlords do. There are many penalties for landlords who violate the rules like you.

It stinks and it's a pain in the butt, but we have to follow the legal system. Also, us landlords have to be human beings. I realize many tenants play the system, but many tenants also fall on hard times and have legitimate reasons. What if something bad happened to you, your family, friends, etc. Would you want your landlord or mortgage lender to do to you what you do to your tenants? Let's all please follow the rules.

@Joshua Zamora I just completed one commercial loan today and I'm doing another one at the end of the week. I also paid cash and wanted to do cash out refinances. I secured 30 year, fixed rate (4.5%-5%), low cost loans in my LLC.

The problem you're having is not that you're out of state but you're working with conventional lenders, such as banks, that are not used to working with commercial/investor loans. You have to use a commercial lender who works with real estate investors. These lenders know exactly what you're looking to do, so you don't have to explain anything, and they're quick and easy. They have many different loan products for you to choose from, including rate and term, cash out, portfolio, ARMs, etc.

I used Finance of America, which is a nationwide commercial lender, so they'll be able to help you, too. PM me for contact details.

@Matt Nico. See my information 3 posts up about my 30-year-round fixed rate commercial loans. I never use ARMS.

@Jennifer Donley I have used several lenders over the years, but I've settled on one that I like and has good rates and terms. They're called Finance of America, and they're a nationwide lender.

As an FYI, I am refinancing two properties with them this week, and here's the information:

30 year fixed

LLC

5-5.5% base rate, but I'm paying a 1% buy down to get to 4.5-4.75%

1% fee and $795 application fee

They only requested an application, LLC documents, credit report, and appraisal

I have very good LTVs (60-65%), and high credit score, so your numbers may differ.

Please let me know if you need more information.

@Trago WAllace  Yes, this is how portfolio loans work. I have had several discussions with lenders about them over the years because they keep trying to convince me to roll all my loans into a portfolio loan.  And I always point out the downside that if I need to sell or do something with one property, the entire loan has to be redone, and they agree that is a danger.

Nice description from @Jennifer Donley as to the reasoning she used when she decided to go with a portfolio loan - you should have a strategy and it should be financially advantageous. I was surprised to hear Jennifer was able to find a bank that would recast the loan if she had to sell one property. The lenders I talked to said they would have to redo the loan, and I wasn't about to keep paying and paying for closing costs.

The only item I disagree with @Jennifer Donley about is that most commercial loans are ARMs (with balloon payment and interest rate reset). There are tons of lenders with 20-30 fixed rate mortgages; all of mine loans are 30-year-fixed with low interest rates. I don't want to run the risk that I have to refinance in 3-5-7-10 years and market conditions aren't good.

@Matt Nico I have avoided portfolio loans because I don't want all or several of my properties to be tied up together. However, I'm familiar with how they work.

You can't purchase or refinance just one property in a portfolio loan. There have to be several for the lender to work with. The most common use to refinance several properties using a portfolio loan after you have purchased them over a period of time using stand-alone loans. If you do find several properties you want to purchase at once, you can also do a portfolio loan.

@Mathew Giladi There are hundreds of lenders that offer what are called commercial or asset based loans. They differ dramatically in their rate and terms, so make sure you shop around. You can find these lenders under the Resources section here on Bigger pockets, I know there is financing Forum somewhere on BP, but your best bet is through a referral from local REI groups or investors. I've been using these for years, and I always shop around for the best rate and terms so PM if you'd like their info (they're a nationwide lender).

Portfolio loans have their advantages, but a big disadvantage is they are considered a package deal, so if you ever wanted to sell one property, you have to sell or refinance all the rest in the package.

@Jenny Stecklair

There was another thread not too long ago on this same subject, and several people chimed in. All of us got hit with special assessments, and everyone said they would never buy in an HOA again. Special assessments can be a few thousand dollars, but some can be quite large. I almost had a $10,000 special assessment to be paid all at once, so some of these can be devastating.

The other thing you have to be careful about is the HOA dues always go up. Mine have almost doubled in a few years.

So a deal that looks good now can quickly be a bad deal due to rising dues and special assessments. You have to make sure you have a large margin.

@Kevin Lanphear

Another vote for the Kwikset Smartkey. I've been using these in my rental properties for years. They're only a few dollars more than the regular locks, as opposed to the digital locks, which are way more expensive. It takes less than 1 minute to rekey a lock yourself, instead of having to change the entire lock. And I just rotate the keys amongst the various properties whenever there is a tenant turnover, or when I acquire a new property/lock they come with new keys, and Kwikset even sells new keys to throw into the rotation. I think these have pretty much become the go-to lock for rental properties.