How to Secure Lending On Real Estate Property 2, 3, and So On

[Josh Platko]

This isn't a post dedicated to excuses per se, but rather its about barriers (both mental and financial) that I need to overcome in order to expand my real estate portfolio. 

I'm 6 months into my real estate investor career - and for the most parts the process has been smooth. Few house fixes here and there, but given a 100+ year old house, its been smooth sailing. Went through the LLC battle in my head several hundred times, and ultimately landed on an umbrella insurance policy as the band aid to hold over my liability anxiety. The first house was no doubt the biggest hurdle in getting into real estate, but the current dilemma is "now what"?

I've calculated my number - how many units I want to get to where I feel financially secure and content with my real estate career.  At this point its never something I would forgo my day job for, but nonetheless is a nice retirement plan. As I look at my timeline for securing additional properties, I start to ponder how will I get this next house?  Easily my biggest hurdle is more lending:

• I just did a $200k deal, so how reluctant will banks be to loan more to me? 
  • If they are hesitant for the second house, they surely will be hesitant for number 3, 4, and so on
  • How do you find lenders willing enough to let you become so leveraged?  I can only imagine investors with 10+ properties are closing in on a 7 figure liability - Is the rental income enough to justify that magnitude of debt
  • On top of that, I will want to get a personal home soon as well (currently house hacking a duplex), I wouldn't want real estate investment debt to be a burden on me missing out on a dream home
  • Then of course I'm cash stricken after putting down the 20%, so it will take some time before my current property generates enough to where I'm ready to afford another down payment (also it should be noted I'm not thrilled about the idea of raising capital through others)

How do you manage your debt as you scale your portfolio? Do you struggle to find lending? I can't say I'd be thrilled about having that much debt under my personal name. Put it under an LLC? I would imagine commercial lending will just be way more expensive, but perhaps thats the price you have to pay for that "very very limited" protection.