What happens when my portfolio lender says, "No more loans."

[Michael Wentzel]

I've been working with a regional bank for about a year and half. I have one property on a 30-year fixed with Fannie Mae. Then I've done three more properties on portfolio loans with the branch president of this regional bank over the last 9 months. He said he would do two more and then we wants to wait six months to a year for the portfolio loans to "season" before doing more. 

I finally have my systems in place and would like to acquire 6-8 more properties this year, but this is putting a hitch in the plan. Can I just shop around for other portfolio lenders and have them do 4 or 5 for me? I hate to split my business/ loyalty. Should I just slow down and wait six months to a year? That's probably not going to happen.

Any wisdom and insight in this area?

Mike

[Joel Owens]

Just sounds like the branch president is doing a CYA.

They want to show they didn't let you run wild so if something imploded later they wouldn't be seen as grossly negligent.

Employees and board of directors at banks worry about their jobs and facing criminal charges if a bank goes belly up down the road.

The bank is demonstrating prudence.  

"He said he would do two more and then we wants to wait six months to a year for the portfolio loans to "season" before doing more."

You have shown you can keep the car in lane going 60 miles per hour. The bank is saying they want to wait and see if you are a good driver over time before increasing the speed. You want to floor it and see how far down the road you can get. A lot also has to do with the size  and growth of the bank. Some are in "growth mode" and some are in "rate mode" for loans at their bank.

If you go to another bank and someone asks why so many so soon?? You could say you watch the investment cycles of different asset classes and with low interest rates want to lock in as many at a low price while you can. Then when the market gets frothy you can be more selective and buy less properties only when the numbers work in an overheated market.