It is another new day, a fresh start. How are you starting your day today? Everyday in life we make decisions that can impact our day or even impact our lives! That is pretty amazing that a simple decision can put us into a whole new direction in life. Sometimes we want to make inquiries of others but we do not take the action to do so. It could be someone we want to get to know better but we have a small bit of fear that takes over.
If you are a real estate investor, you learn that coming out of your shell is crucial. You need to be polite and professional but you also need to be heard and take action. Be loud and be proud. Ask your questions to find the answers you need.
How often have you walked into a bank and wanted to ask, “Hello Mr. Banker, do you have any money to loan that might be burning a hole in your pocket?”
Did you ever just think about asking this question to a banker? Go ahead and ask the question. However, do not be that blunt. There is a way to make an inquiry so how is this done?
1. Go to a website such as www.yp.com and look for small banks or even credit unions in your local area
2. They may have a link to their website so if they do click on the link and read a little about each bank under their about us section and loans and mortgages.
3. Call the each local bank and write down who you speak to each step of the way. By knowing names at a bank it can gain you a little credibility as you call your way up the corporate ladder of the bank.
4. Ask for the commercial loan department.
5. Identify yourself as a real estate investor that wants to work with a new bank in the local area.
6. You can inquire that if you own some properties free and clear of a mortgage, do they offer a mortgage product where you can do a cash out refinance on these type of properties.
7. If the answer is yes, then ask the bank the following questions:
8. Is there a seasoning requirement? Meaning do you have to own the property for a certain period of time. For example, you have to be seasoned into the home for 6 months or 12 months. Some banks require it, so do not.
9. How much will they borrow and what is it based on? The loan should be based on loan to value of the appraised value not what you have into the home. Some banks today are loaning 60% or 70% of loan to value. Meaning that if they loan 70% loan to value, you could borrow up to $70,000 for a home that appraises at $100,000.
10. What is the total amount they will loan to any one real estate investor?
The more information you gather the better decisions you can make. There are banks and some credit unions that will make non-seasoned cash-out loans. If you want to do buy and hold rentals, you may want to recycle your cash. Put it into a property and get it back out to leverage that cash again! Its like passing go and you collect $200.
You will need to buy the deal at the right price, refinance the property and pull the cash out right away and keep moving forward with your real estate investing. It may take you several calls but when you find one or two banks that are willing to loan it is well worth your efforts.
Banks are lending, we just need to find these banks and see if they will work with us. Live life in the moment with no regrets! Believe and Achieve! – Joe Jurek