Financing in Chicago>Question Details

Joe, Home Buyer in Chicago, IL

What banks are financing investors for SFR rentals?

Asked by Joe, Chicago, IL Mon Sep 12, 2011

We currently own 11 SFRs in SW burbs, mostly sec 8 and each pulling >1K rent. Very little debt but no banks are interested in lending. We can do deals all day long for 60k rehabbed and get 1k rent but need financing to expand. Would not consider hard money.

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Based on what you said here (and a bit of reading between the lines), I believe I have a product you can utilize to finance investor-rehab single family homes. The only criteria that wasn't already stated would be that you CURRENTLY have no more than THREE financed properties in the name of the investor (your fourth would be the subject property) taking the mortgage (yourself, your brother, etc). If you're able to meet these requirements, I could get you closed in 30-35 days from a full credit package (including contractor bid and signed application).

Once the rehab is complete, if you decided to pay it off or refinance it into a LLC, you'd have room on your credit again to do this again.

I speak regularly about products like this to first-time buyers, Realtors and investors (I just recently guest spoke for 64 people for an investment group here in Chicago about RE investment financing). I'm currently doing two of these loans for two different Realtor's personal investment property acquisitions.

You can reach me via my profile (click on my picture) if you'd like additional informaiton. I can do these loans in all fifty states.
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1 vote Thank Flag Link Thu Nov 17, 2011
Hi there, Joe.

Thank you so much for your message and good for you - for sustaining and growing real estate based business in this tough market.

Best bet for you is to give us a call at 312.242.1000 - we have a number of experts who specialize in investment properties and they will be able to put you in touch with lenders who specialize in just this type of financing.

Best of luck to you!
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0 votes Thank Flag Link Wed Sep 14, 2011
Hi Joe,

Sounds like you have a pretty sound business on your hands. As long as you have a 25%+ down payment and 3+ years of experience with these rentals, I cannot imagine why you cannot get a loan.

I have a lender here locally in Dallas, TX that has done several investment loans for me. I would be happy to give you his information. They have branches in several states, not sure about IL though.

Have you considered investing in Dallas, TX? There are some great rental areas around here that are bringing in 10-15% + return on investment, similar to what you are describing. I have a property manager that I have worked with on several occasions that would collect the rents and handle repairs.

Give me a call and lets chat.

It's more than real estate. It's RAYL-Estate!

Brian Rayl
Keller Williams Elite - Dallas, TX
0 votes Thank Flag Link Tue Sep 13, 2011
Sorry all - should have clarified. The 'debt' we hold is not in the form of any mortgages. It is from a business line of credit so I do not believe it is an issue of the number of props with fannie.

I am following up on some if the leads provided. Thanks again everyone - looks like I may have some options.
0 votes Thank Flag Link Tue Sep 13, 2011
Good luck Joe,
Your limitations despite your strong profile are due to the maximum number of properties financed being 10 for Fannie and Freddie loans. You definately want to look for a local bank who will hold your mortgage. It sounds like your strategy is to hold and not re-sell. However, if you, your brother, or your dad have securities, not 401K assets, you can give me a call. We have special financing options that may be available.
Cecelia Marlow
Chicago Bancorp
Mortgage Banker
0 votes Thank Flag Link Tue Sep 13, 2011
Scott's reply is exactly what I would have thought we could do, although I have been meeting with banks not mort cos.

More background if anyone has good refs: my brother and I finance the deals, my dad does the work and we split the profits 3 ways. My brother and I each make well into 6 figures and have high 7s credit, and I already described our current inventory. We literally have tenants waiting for us to finish the next house, all based on referals. Went to 4 banks so far - 1 big, 2 mediums, and 1 local - 3 of which we have existing relationships. Biz tax returns for first 2 years are not great as we were building up, but the cash flow and backing is there, still all 4 said they are not lending. That was not based on our specific numbers - they arent doing RE investment lending at all.

I would have thought we'd be a slam dunk with our situation??

I'll be following up on leads posted here.

Thanks all.
0 votes Thank Flag Link Mon Sep 12, 2011
Yes, you need to find a portfolio lender. My web site has one reference.....PNC
0 votes Thank Flag Link Mon Sep 12, 2011

Fannie and Freddie guidelines are whats restricting you. They have a limit on financed properties.
Your best bet is to contact a local bank in the area you want to buy. They would have to portfolio the loan to do it. You might have more success that direction. Good luck in your search...

Steve Smither
Senior Loan Originator
Midwest Equity Mortgage
847-942-5151 Cell
0 votes Thank Flag Link Mon Sep 12, 2011
Joe your best bet is to meet with a local and trusted loan officer who can review your financials and your goals and see what they can offer you. A mortgage company will have more sources than a bank. Without seeing your financials, anyone that says they can help as a big "if" that goes along with it. Good luck in buying , sounds like you are doing great
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0 votes Thank Flag Link Mon Sep 12, 2011
I may have someone that can do this. Id be happy to refer them to you.
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0 votes Thank Flag Link Mon Sep 12, 2011
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