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Jeff

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I am trying to refinance two houses I have in OKC.

I am running into the same old problem of having more than 10 houses.  Anyone else have a suggestion about getting around the 10 house limit?  I know it is possible, because I already refinanced 8 of my houses...but I can't find a bank in OK that will work with me.

 


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brycewheeler

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Reply with quote  #2 
Jeff.  There is lots of old ideas from this board.

Some I remember but none are good ones for best priced loans.

For example East West Bank is great for loans at reasonable rates but they want only huge loans on million dollar plus properties and they require $50,000 balance in your bank account with them.

Their are lots of small banks and private investors who will do loans but they want interest rates of 7 to 8 % minimum and many want loan fees etc etc on top of that.  Some require all kinds of other terms also.  All are slightly different but none will give you 4 and 5% interest rate terms.. They are like semi-hard money loans.  Some may want 40% down payment or 50%.   Threy regard anyone with 10 or more loans automatically as HIGH RISK!!!

What I do is sell either my worst property OR  highest loan property  OR  my property with the highest equity with a loan which thereby reduces my 10 loans to only 9 loans, and WWAALLLAAAHHH.  NOW I only have 9 loans.  Then I take my total profit from my sales  transaction and give it to a 1031 bank intermediary who hold it while I buy two replacement properties with the profit, one of which I buy with a new 10th loan from WintrustMortgage and the 2nd property I pay all cash.  I have done this repeatedly, not always with a 1031 because I have had several in the past several years where the 1031 failed as I could not work out the new purchases in time and meet the date requirements for the 1031 terms.

Of course when the 1031 fails I pay taxes on my profit thrugh the gazuu, but if you space your sales maybe only one a year or so, you can live with it.  In my case I am selling in a high price area (San Diego) and buying in a cheaper area (suburban Atlanta GA) so it is necessary that I buy two properties anyway to meet the 1031 rule of purchasing an equal or higher priced properties in total.  I do this whether it is a 1031 deferred exchange or just a straight sale.  Luckily the suburban area of Atlanta GA where I buy is a great area with increasing rents and appreciation much like California but starting from a lower base of prices.  Also I have a daughter that is a good investor and property manager who lives in Peachtree City Georgia and she takes care of the properties in Georgia for me.  Otherwise I probably would not have rentals out of my area.

So in summary, there is no magic bullet to get around the 10 loan limit rule for good loan terms, that I know of but earlier in my investment career,  there was a bank limit of 4 loans max.  It took me some time to discover the banks that would exceed the 4 loan max rule.  Many lenders and banks told me at that time there was no such thing as getting 5 or more loans.  Just goes to show you that you just got to go on plugging.  But Jeff, we know you are an expert at that anyway, so good luck in finding something better than I did.

Bryce


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Quote:
Originally Posted by brycewheeler
Jeff.  There is lots of old ideas from this board.

So in summary, there is no magic bullet to get around the 10 loan limit rule for good loan terms, that I know of but earlier in my investment career,  there was a bank limit of 4 loans max.  It took me some time to discover the banks that would exceed the 4 loan max rule.  Many lenders and banks told me at that time there was no such thing as getting 5 or more loans.  Just goes to show you that you just got to go on plugging.  But Jeff, we know you are an expert at that anyway, so good luck in finding something better than I did.

Bryce

 

Thank you for providing this information and telling me about your experience.  I have contacted WintrustMortgage to see what they offer.

A few months ago I found the "holey grail" of refinancing in SLC.  They knew I had 10+ houses, and they not only let me refinance, but they let me pull out roughly 150k to boot.  And get this--they let me pull out money to 90% LTV.  90% LTV when most other places were only offering 75% or less!  Never in my 12 years of shopping for refinances have I even HEARD of such a thing.  And their rates were at market!

Of course, there are some limits on this program.  They only will do 2 houses per investor--and they won't do homes outside of Utah.  This leaves me kinda out of options for OKC.  But knowing that 90% LTV programs are out there make me not want to settle for a crappy loan.

 

 

 

 

 

 

 


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Jeff

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O.K.  I found a bank to refi ONE of my houses.  Can I ask you some advice?  Anyone?

I currently have a variable rate loan at 3.75% with 18 years left to pay.  Great rate right?  SO why am I even considering a refi?  Well, I am worried that rates will go up and my cap is pretty high (~10%?).  If rates go up significantly, that will leave me WISHING I had switched to a fixed.

The bank's current offer is 4.75% with about 5k in "real" costs (title insurance, points, origination fees).  This will save me about $100 a month (money is REALLY tight right now) so that is good, but to get that I will have to re-up for another 30 years.

I really hate to pay 5k for the right to borrow money...and I really hate to refinance into a HIGHER rate...bit I get really nervous when I think about mortgage rising over the next decade.

Is the switch into the "safer" loan worth the cost?  Are mortgage rates going to rise a significant amount in the next few years?  Am I going to be super sorry if I let this offer go? 

Or will I be sorry that I paid such a high price to switch...and then rates stay low?

 

Thanks,

Jeff

 

 

 


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brycewheeler

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Jeff.  Can you provide any details on SLC.  I am not familiar with them.

At WintrustMortgage, i dealt with Chaz Hinz and Justin, Encinitas CA 92024  office.

Bryce
Jeff

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Reply with quote  #6 

I guess my question boils down to what are mortgage rates going to do over the next 10 years or so...

 

Can anyone polish up your crystal ball and weigh in here?...


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Jeff

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Quote:
Originally Posted by brycewheeler
Jeff.  Can you provide any details on SLC.  I am not familiar with them.

At WintrustMortgage, i dealt with Chaz Hinz and Justin, Encinitas CA 92024  office.

Bryce

 

Please tell Molly hi for me...

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brycewheeler

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Thanks Jeff.  Will say hello from you.

Bryced
Jeff

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Reply with quote  #9 
It took me literally three years of "cold calling" Credit Unions around the country to find that resource...I hope you can use it!
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brycewheeler

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Thanks again Jeff, I sure hope to use it well.  Maybe an 11th loan in future.

 Was just approved by lender Chaz Hinz, WintrustMortgage  (phone 1-858-922-0645) on another 10th loan again as I sold the property having my prior 10th loan.  My rental sale with the prior 10th loan  closed a week ago- a Calif sale on rental I bought 6 years ago.   New Loan is a 30 year Fixed at 4 3/8%, 25 % down as an investor loan.  I never lie to my lender about living in the property.  They know it is a rental loan and this is my 5th or 6th loan from them in  last 4 years.  I am happy with this good relationship.  With proceeds am 1031'ing into a moderately upscale 3-2-3 in Peachtree City'GA on the 10th loan plus buying a nice 2-2 condo ALLL CASH, also in Peachtree City GA with a little left-over proceeds which I may have to pay a little tax on if my normal write-offs do not cover it.  My lender in Calif. does all the loans I make in Georgia easy as pie.  So far in this real estate cycle I have been able to sell pretty high in Calif. and buy pretty low in Georgia.(Somebody said thats not too bad a strategy).  However, property values in that nice Atlanta suburb of Peachtree City GA have increased to the point that the low hanging fruit is disappearing fast.  Oh well, they say it ain't easy trying to get rich.

Bryce
Jeff

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Reply with quote  #11 

You might be able to get an 11th and a 12th!

 

4 3/8% is a very good rate.  The loan they are offering me now is a 4.75%.  Given my circumstances, should I take it? 


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brycewheeler

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Jeff.

The ability to obtain loans at present rates is key to success in the long run.  Even 4.75% for an investor (non-owner occupier) to me is a pretty good loan, particularly as measured against the last 60 years or so.  I remember being very happy and fortunate to get loans of 7 to 9% on 4 plexes etc in the 70's and 80's in Orange County, Calif.  And of course I had a nightmare VARIABLE loan on some farm rental property that went from 7% to 15% before I turned heaven and earth to pay it off (lots of sleepless nights).

So, all in all, even 4.75% is a gift in my opinion.  Take it and run !!  Do what all the multi-jillionaries are doing the past ten years and get loans up the gazoouu  while they are the cheapest in modern history.  You won't even notice the half percent or so when you count your profits 10 years from now.

Bryce
Homeloanwisdom

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Reply with quote  #13 

You'll need a bank or credit union that also has a branch or is licensed in Oklahoma. Individual bankers and brokers need a Loan Originator License in the state they o loans and so it is unlikely you'll find a lender in California (without researching) that is licensed in Oklahoma since it requires an annual renewal.

Advancial Credit Union will make loans to investors with more than 10 financed properties. I can't vouch for the rates/terms but I see they've got an office in Oklahoma City. 


AV CU.JPG 
Not any thing I can do. I finance 5 to 10 units in California.



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Jeff

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Thanks Thom.
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2Encinitas

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Jeff! Your back in the game!!! So Awesome.  
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Jeff

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Reply with quote  #16 
Quote:
Originally Posted by Homeloanwisdom

Advancial Credit Union will make loans to investors with more than 10 financed properties. I can't vouch for the rates/terms but I see they've got an office in Oklahoma City. 



 

Advancial initially said no problem, we can do it.  But then 24 hours later they said that they only do primary residences for people with 10 houses.  They gave me mixed messages...but right now the answer is "no."  Weird.

Any other ideas?  Anyone?

 


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brycewheeler

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Jeff

Just reporting on your good lead for my 11th and 12th loan possibility.

After playing phone tag and Molly  being gone few days, she reported that her credit union does not have license to loan either in Calif. where I live, or in Georgia where I am buying in a suburb of Atlanta, so she was unable to help me exceed the 10 loan limit I am up against.
But it was well worth a try.  She suggested more calling of credit unions in the states where I want loans.  Of course I have already done a lot of that without success.

Molly's credit union is active in many Midwest and Mountain states surrounding Utah where she is located, but not Calif. and not GA.

Anyway thanks for the tip.  It ain't easy getting rich.

Bryce
Jeff

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Quote:
Originally Posted by brycewheeler
Jeff

Anyway thanks for the tip.  It ain't easy getting rich.

Bryce

lol


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Jeff

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Quote:
Originally Posted by brycewheeler
Jeff

She suggested more calling of credit unions in the states where I want loans.  Of course I have already done a lot of that without success.

Bryce

 

Over the years, I have probably called a thousand Credit Unions...I am working on my first 50 in OK right now...


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larrywww

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Reply with quote  #20 
I don't have any suggestions in general about this topic, but I do recall a stray remark from Bruce Norris that not only is it difficult with most national landers to get to house # 11, even if theoretically this might be possible, there are alot of lenders who have overlays that prevent going beyond 4 properties.

Based upon that standard, it seems that both of you have done very very well.
Jeff

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Quote:
Originally Posted by larrywww
I don't have any suggestions in general about this topic, but I do recall a stray remark from Bruce Norris that not only is it difficult with most national landers to get to house # 11, even if theoretically this might be possible, there are alot of lenders who have overlays that prevent going beyond 4 properties.

Based upon that standard, it seems that both of you have done very very well.

Yes, getting to 4 is somewhat hard.

Getting to 6 a little harder.

Getting to 10 is super hard.

Getting to 11 and 12 using conventional consumer loans is almost impossible, but can be done!  (I know cause I did it! [wink]

In the last three years, I was even able to refinance each and everyone of my existing 12 mortgages...except the two I have in OK.  Oklahoma may be the one state where it is LITERALLY impossible.

I am continuing to make calls though and haven't given up.

 




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mlreits

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Reply with quote  #22 
Jeff,

I know East West Bank does no doc loans. However, they only go up to 50-60% LTV. Their interest rate is prime + 1% so it's 5.25% at the moment. I know they lend in the Bay Area and some areas in SoCal, but don't know about other markets.

Good luck.

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Reply with quote  #23 
You may be able to get around it by getting one loan for all the houses (a commercial loan), that way only one property shows up and it's a commercial loan, vs a residential loan.
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Jeff

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Quote:
Originally Posted by mlreits
Jeff,

I know East West Bank does no doc loans. However, they only go up to 50-60% LTV. Their interest rate is prime + 1% so it's 5.25% at the moment. I know they lend in the Bay Area and some areas in SoCal, but don't know about other markets.

Good luck.

 

Thank you.  I will look into this for me.


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Jeff

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Quote:
Originally Posted by CGabhart
You may be able to get around it by getting one loan for all the houses (a commercial loan), that way only one property shows up and it's a commercial loan, vs a residential loan.

 

I have seen this elsewhere...but never tested it.  I gave also ben told that this will NOT work, as the critical value is NOT the number of mortgages, but the number of "mortgaged properties."  This means that wrapping 11 properties into one loan does not help...as you still have 11 mortgaged properties!

Has anyone tested this!?

 


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rickencin

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Reply with quote  #26 
Maybe life is telling you to move on to apartment buildings.

You have to make your money when you buy.  You will get beat up on CAP when it is time to sell.  The better the CAP, the lower the selling price.  Apartments just don't have the pride of ownership of houses.  

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Jeff

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Reply with quote  #27 

Quote:
Originally Posted by rickencin
Maybe life is telling you to move on to apartment buildings.

You have to make your money when you buy.  You will get beat up on CAP when it is time to sell.  The better the CAP, the lower the selling price.  Apartments just don't have the pride of ownership of houses.  

 

Where do I get the money to buy apartment buildings?  Where do I buy (not CA?)? 

 

I struggle each month to pay my mortgages as it is...how will buying apartment buildings solve this problem?  16k is pretty hard to hit each month as it is...

 

 


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rickencin

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Reply with quote  #28 
OK, stick with houses.
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Reply with quote  #29 
Quote:
Originally Posted by Jeff

I am trying to refinance two houses I have in OKC.

I am running into the same old problem of having more than 10 houses.  Anyone else have a suggestion about getting around the 10 house limit?  I know it is possible, because I already refinanced 8 of my houses...but I can't find a bank in OK that will work with me.

 



My suggestion is to find another investment vehicle that doesn't have those kinds of restrictions. If you look they exist and your skills will be valuable and transferable.  Good luck.

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Jeff

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Reply with quote  #30 

Quote:
Originally Posted by TomScott1


My suggestion is to find another investment vehicle that doesn't have those kinds of restrictions. If you look they exist and your skills will be valuable and transferable.  Good luck.

 

Find a another way that doesn't have those problems. 

 

Hmm...what a good idea.  


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