Negotiating Loan Terms

[G. Emerson Zollos]

Hey everyone,

I have been struggling to figure out how to not over leverage when dealing with 5-10 year loan terms. The FCUs in my area have some solid underwriting practices i.e. lending on appraisal value not sale, easy financing on rehabs, etc. However, the sticking point is that I'm getting his with a 5/20 term/ammortization. We are looking to BRRRR on our properties and are only cashing out at a 60-70% LTV. Furthermore, we have 3 investors each bringing significant funds to the table.

In my mind we are ideal candidates for loans but the 5 year term is killing our growth model. It feels like a 5 year term means we are inevitably at the mercy of a refinance from the bank in 4 years and that amount of risk means we cant really expand aggressively.

Our current portfolio is 1 property in the LLC with 2 properties being moved into the LLC. Our equity stake is north of 300k between the three. My question is fundamentally, what can we do to maximize our desirability as borrowers, and is it possible to push a lending insitution to lend on a 15-20 year term rather than 5-10 given our current portfolio?