Portfolio Loans for Real Estate Investors Call (702)900-9476 To Get Started
What is a portfolio loan?
A portfolio loan is a loan originated by a Savings and loan, Bank or Credit Union that does NOT get sold into the secondary market i.e. Fannie Mae and Freddie Mac. These smaller lenders typically don’t sell the loans off to Freddie or Fannie, therefore they don’t have to follow any of the new rules such as a maximum number of 4 financed properties and no unseasoned cash out. There are portfolio lenders out there that allow an unlimited number of financed properties and unseasoned cash out. We have a relationship with many of them and can guide you through the process of getting a low interest loan.
Master Loan Commitments
Once you establish a good relationship with a portfolio lender, you can take your business to a whole new level with a master loan commitment. Let’s say you are a rehabber that likes to keep properties long-term as rentals. You buy them with hard or private money, fix them up and then you refinance them. If you are using conventional lenders, you can only have three rentals TOTAL because that maximum 4 financed properties rule includes your primary residence.
Well, you can negotiate a deal with the portfolio lender where they agree to refinance all your FUTURE deals up to $1, $2, $3 even $5 million dollars over a 12 month period. That way you’ll never have to worry about where the refinance will come from or IF it will actually go through.
LLC Loans
Portfolio lenders will originate and close a loan in the name of your LLC. That means it doesn’t report to your personal credit report. The LLC does not have to be two years old and does not have to have any assets or cash flow. You are still personally guaranteeing the loan, it just won’t show up on your personal credit which means if you still want to get a Fannie or Freddie loan down the road you can.
The credit report is what tells the conventional lender’s underwriter how many properties you have financed so if you have many LLC loans but none are on your personal credit, then the underwriter at the bank will write ZERO in the box that asks for the number of financed properties you have.
Blanket Loans
A blanket loan means one loan that “wraps” many individual loans into one loan. If you have many LLC loans, you make many checks out each month, pay many tax bills and pay many insurance bills. Plus you have many different rates. And if they are adjustable rates, good luck trying to keep up with when they need to be refinanced.
A blanket loan will take all of those loans to make one big loan requiring one payment each month at one rate. This is a great strategy for people that are buying or refinancing in bulk since its one loan that goes through underwriting; not many.
One thing to watch out for on these loans is the release policy which is what happens when you want to sell or refinance one property that is in the blanket. Some lenders will allow it with a fee, some won’t allow it at all and will call the whole blanket loan due and others will require a substitution of collateral. That means you’ll have to put another property of equal or greater value in the blanket to take the place of the property you’re taking out.
Portfolio Loan Preparation Service
Getting a Portfolio loan is a complex process requiring research, due diligence and time tested relationships. Over the past twenty three years we've managed to cultivate these relations and today YOU can benefit from our years of experience by allowing us to guide you through the process of securing your next portfolio loan. Contrary to popular beliefs low interest investment property financing is not dead. In fact it's very much alive and deals can be had for as little as 5.5% amortized over 20 years. Imagine not worrying about the balloon payment that you have coming due in the next 3-5 years. With a portfolio loan you can have as many properties financed as you wish financed in the name of your LLC and never worry about Freddie or Fannie guidelines or any of the loans showing up on your personal credit report. A portfolio loan gives you the ability to fast track your real estate investments by providing you with loans for new acquisitions, refinance, refinance cash out or even a master loan commitment for future acquisitions. Our loan preparation service will evaluate your current portfolio of real estate owned and help you determine what the best loan for your investing strategy is going forward.
Next we will prepare a list of 3-5 portfolio lenders in your area that are willing to provide you with the loan on the terms that you require.
We then assist you in preparing and collecting all the necessary documents to get you approved and funded.
Next we arrange appointments with the lenders and properly arm you with the relevant questions and documentation required by the lender.
Finally, after a successful campaign the lenders will provide an offer sheet or Letter of Intent (LOI). At this point you will consider all the offers and negotiate with the lender for better terms based on the other offers you have on the table. You then follow-up by complying with the terms and getting funded.
Unlike most of the other loans that we either provide or broker there is absolutely NO BROKERS FEE OR POINTS charged for this loan, instead we charge a nominal fee to prepare your package for submission to the lender. Once you submit your loan scenario, you will be quoted all charges.