Lending Companies for Real Estate Investors -...

Lenders for Real Estate Investors

learn about the lending companies that exist specifically for real estate investors

what they are how they can help investors with financing why they might be a good option

Lesson

Agenda:

What is a lending company for real estate investors?

These are companies who lend only to real estate investors

(rentals, flips, commercial, new construction)

Lending Companies for Investors

They are not the Bank of Americas or BBTs that we typically see as the

traditional banking institutions

These companies exist to lend to investors and have different guidelines

and underwriting processes than a traditional bank

While traditional banks have bank guidelines and federal guidelines they

must follow when qualifying and underwriting loans…

How they are different than traditional banks?

…these lending companies underwrite each potential new loan based off of

the cash flow it produces (not the income)

How they are different than traditional banks?

When you take out a mortgage with a traditional bank they are qualifying you based off of your personal income vs.

your person debt.

For example…

They are qualifying and underwriting the loan more as a business based off

of the cash flow it will produce

With these lending companies…

Let’s see an example of terms…

-limaonecapital.com

Let’s see an example of terms…

-financeofamerica

If you have issues qualifying based off of personal income and debt-to-income ratios with a traditional

bank…this may be an option for you

Why would you use one of these lending companies?

If you’ve reached your max number of loans that you can hold with traditional banks (10) and you’re still looking to use financing to acquire properties…this

could be an option

Why would you use one of these lending companies?

Investor Lending Companies

Pros and Cons

Pros

Enables you another option to obtain financing when

you can’t get it from a bank

Pros

No limit on how many loans you can have

Pros

Underwrites the loan based off of cash flow not

personal income

Pros

Allow you to purchase new properties or cash out

refinance current properties

Cons

You’ll have a higher interest rate than you would with a

traditional bank

Cons

You may have to have an LLC for them to lend to you

(some, not all)

Cons

Will require a minimum loan amount

The reality is that it does give another option for investors to take advantage of when it comes to

financing

Conclusion

There may be some more flexibility with one of these lending companies than a traditional bank as they keep the loans in house and don’t have the red tape requirement hoops like big banks.

Conclusion

Offer various loan products for investors (rentals, flips, new construction, etc.)

Conclusion