Whos the best to borrow from? Hardmoney? Crowdfunding?Bill Gates?

[Brian Tennies]

Hello!

I'm new to BiggerPockets, but it was highly recommended that it would benefit me.

I am pretty established, for a small fish, in the real estate game.  

I own several properties and am at the point where I want to either pull money out of some properties, or I want to borrow to privately to continue growing the business.  

I'm sour on banks because they all laughed me off when I pitched them my real estate business idea 5 years ago, I pitched to six financial institutions too.  Now that I have assets, rental properties, the same assets they found funny and "not invest-able" at first, they'll beg to work with me, but their fees are crazy....when I do the math, private investing almost seems like it would be a better way to go.  Since my properties are inner city my closing costs alone were almost $3k on a 10 year mortgage loan around $50k, that's insane for a property that generates the rent it does.

If anyone has any advice or links they could send my way I'd appreciate it!

I'm sure I'll be online for the next three days looking over this site...good stuff on here.

Thanks!

[Brie Schmidt]

Well, seeking funding on the general forums is against the rules and could result in the post being removed.  That being said, as the owner of 26 properties in WI - I can tell you about my financing experiences.

I personally use a commercial bank.  The terms I see are 5 year loans around 5% on a 25 year amortization.  We generally pay city/county/title fees plus a $200 loan fee, $19.50 flood certification fee, and $150 appraisal fee.  We have a pre-pay penalty of $200 and that's it.  In the world of commercial, your ability to run the business is just as important as the numbers on the property.  If you have had them for 5 years and have the profitable tax returns to prove it, you should be in a good position for this type of lending.  

In my experience, private lenders want at least 8% interest and hard money lenders want at least 10% interest plus a min of 2 points.

You could also do a residential loan depending on how many properties you have.  Once you have loans on 5 or more properties, you are no longer able to cash out refi on anything that isn't your personal residence.  

I would personally never do a HML with a long term hold property. I would do private money if the person fully understood my long term strategy and the terms were right. And I would do bank loans all day long.