I am in the hunt for a good lender to work with in the single family home investment market, rentals mainly. Credit is above 680. Some investment capital available. Can anyone tell me what to look for and what kinds of questions to ask to narrow down my search?
Thanks in advance.
Joe
Sent you a private message
I’ve posted this before and just copied over again for you.
Finding the right mortgage consultant for your investments will be important for the growth of your business. Once you have found a professional whom you feel comfortable with he will need to pull credit to review over scores and tradelines. There may be a few short forms to complete as well so that he can intelligently discuss loan options with you. A credit check should not be needed again until another property is ready to be financed. (As a side note, when your credit is pulled by a mortgage broker or auto lender, the bureaus treat up to 15 hits within a 30 day period as one.) The consultant should be asking questions about your short and long term goals so that the appropriate mortgage terms can be matched to the subject property.
There are many lenders a broker can use and most of them offer the same programs. A handful will even allow 100% financing for 1-4 units. However the guidelines may be slightly different at each. Some of the key points lenders will consider are listed below.
The variation of these is why long term goals need to be addressed. Certain lenders will need to be used first as their property restrictions will prevent financing. The lenders that allow unlimited properties usually have higher rates and should be used as the portfolio grows. In some cases, as the equity increases, investors will use a local bank to obtain a blanket refinance loan in the name of an LLC.
Speaking of an LLC, it will be important for you to be teamed up with other professionals who can give tax advice and estate planning advice. Your mortgage consultant can work hand and hand with them as well.
A great mortgage consultant should also be able to provide answers on how to qualify for 100% rehab financing. They should also be able to explain how lenders can approve 90% cash out refinances with no seasoning of title. This will be valuable if you complete a rehab or have purchased a property well below market value.
So far this only address the knowledge your consultant must have. Don’t forget about service. This includes communication with you and the real estate agents involved. Every transaction goes through the same process. Within this process there are some key events which can be updated to everyone. Part of service also includes helping you manage the terms on your portfolio. A professional should be aware of how mortgage backed securities affects interest rates and have an opinion on what direction the market is heading. As your consultant he can notify you periodically of new loan products or lower rates.
I hope this has helped give you an idea of the service that real estate investors are entitled to.
Joe, Shop around. Find someone that you feel comfortable with. You will want someone that is experienced in N/O/O properties. Do your research then make a decision.
You will get a ton of IM’s from your post on this site.
Do not let everyone pull your credit! I would wait until you have found the Lender/Broker that you feel most comfortable with, then have them pull your credit.
Good Luck!