Working through the "4 Mortgage" Rule?

[Harrison Painter]

I wanted to get some conversation going about the "4 Loan" rule that the lenders are sticking with at the moment.

Keep in mind that I am talking about direct lenders/mortgage brokers, not hard money or other more creative owner financing in this topic.

My investment network offers a "Zero Down, Equity & Cash Flow" Deal on our rehabbed rental homes. We basically offer our investors a rate & term refi out of a private note within 45 days based on 65% of the banks current appraised value. That is the price the investors buy our rehabbed deals for. There is enough room in the refi to roll in the closing fees, as it can go up to 72% without any problems. So it creates a real no money down deal.

Since the investors that buy our homes are looking to hold for at least 3-5 years, and our price points are so low, they usually want to buy 5-10 property packages.

That is where the snag comes in.

We have some great lenders that can do our first 4 deals, and we have one source, a small bank in the Midwest, that can do up to 8. Properties 5-8 are done a 55% starting point, so the investor does need to come out of pocket a bit for the last 4. It is working out very well, but I just don't like having only one option to offer folks.

We are in process of talking with a company that does "Stock Portfolio" based loans. However, this is a new product and I have not had any experience with it yet. So if anybody has some feedback with this type of product, that would be great.

If anybody has a solid lender that you trust, and are having success with, I would be happy to send them some business and make them a part of the Gladiator Investment Network on your recommendation.

The areas we currently work deals in are Indianapolis and Atlanta markets.

I am always here to network, share ideas, create solutions and MAKE INVESTMENTS HAPPEN!