Should loans be from local bank or where investement is?

Question

Hi all,

I am greener than green to the real estate investment field.  I 've not been this excited about life in a while, buying property as a means to build wealth is an exciting venture.  LOOOOOVE this country.

so my question is, when buying an investment property out of state, VA in this case,  which is wiser, getting a loan from a bank where I, the investor, reside OR getting a loan locally where the investment property is?  I know PNC  our bank here also has a branch there....

thanks so much

Francesca

Craig Curelop · Answer

@Francesca Calabretta - A local lender will probably be better just because they will know your market a lot better. I'm sure there are plenty of lenders that you can choose from.

If you know of a lender closer to where you are living now, get a quote from them too. It certainly doesn't hurt.

I would go with the lender that seems the nicest to work with and has the cheapest rates.

Frankie Lotrec · Answer

WOW! This is simply phenomenal.   I can't believe the wealth of knowledge I've just gained in matter of minutes......FREE!

Grazie!

Stephanie P. · Answer

@Francesca Calabretta

To answer your question directly, it's all going to depend on how organized you are, how hands on you want to be with your investment property and your level of confidence in your management company if the property is out of state.

Regarding getting a loan from out of state, it depends on the type of loan you're going for.  If you're looking for a bank loan, I would go to a local bank and exhaust all avenues of local lending prior to going to a larger company that handles out of state lending.  It will be less expensive going conventional than implementing commercial funding from out of state vendors.

Stephanie

George Taylor · Answer

@Francesca Calabretta Another option is to go through a broker and have them do all the work for you so you don't waste a lot of time contacting direct lenders. Since PNC is in VA then you should talk with them first. If you want a second opinion after they give you terms then don't hesitate to reach out.  Thanks..

Chinmay J. · Answer

Lender will only loan to you if he is licensed in that state. Only thing that matters is that if your lender is licensed in VA. I have a great lender in IL who is licensed in VA. So he knows a thing or two about working with someone who is long distance. Send me a PM if you want info. I can't post it here due to rules.

Frankie Lotrec · Answer

thanks so much Craig Curelop....

" local to me" is PA. " local to property" is VA. are you saying check out both?

Craig Curelop · Answer

Hi @Francesca Calabretta - It does not matter where your lender is located. My suggestion would be to call at least 6 or 7 and see what they have to offer. If you're looking to get started the smaller credit unions typically have more flexible terms. I would recommend calling a few that are local to you, local to the property, and maybe some larger ones who can offer you a smaller rate.