Advice on approaching a local bank as a new investor

[Brian Garrett]

Originally I was planning to buy deals all cash but I've decided based on my goals to leverage my capital.

I have been working on some financing options so when a deal presents itself I already have my ducks in a row.

As part of that due diligence I'm planning on approaching a few local banks and credit unions that I have history with.

I don't have a W2 job and haven't had any real income for the past couple of years. I was exiting from my last business.

I'm now focused on REI full-time moving forwards so there won't be another job or income stream outside of this.

I do have tax returns that show some income but it's very minimal and basically just what trickled in the past 2 years.

I have a good amount of liquidity in terms of cash, I have zero debt and I have a 750+ credit score.

Should I approach them with the intentions of trying to get regular conventional financing?

Should I tell them I'm an investor and discuss my strategy and the types of properties I want to buy with them?

Should I see about a line of credit instead and not even mention anything about real estate?

I figure I need to think this through in advance because if I go to them for conventional financing and get denied due to my lack of W2 and/or proof of income it would be pretty difficult to then say "hey what about a line of credit" since they already know what I'm looking to do at that point. So ultimately I guess my question is if I'm denied for one type of loan will that affect me from being able to try other financing avenues through that same bank or credit union?

[Daniel Helland]

Whatever you decide, approach the bank you least want to do business with first. Let them be your practice run before you approach the more desirable ones. That way if you screw up, no worries, just move on.