Institutional financing- What determines the financing model?

[Daniel Ditto]

With little experience I am trying to understand how you make the decision between the type of institutional financing you go for on a buy and hold rental property. What I have seen discussed on BiggerPockets has only served to confused me more and more. I assume these options have been discussed and compared in these forums before?

I have a 5/20 year balloon on some rentals and I honestly didn't know enough to consider otherwise because that is what the banker said is standard. Its worked out well so far but my lack of knowledge on the subject still gives me goosebumps. The only conventional I have ever done is on my home which I plan to eventually convert to a rental but with low interest rates it seems to me that getting a conventional for 30 years would be a no brainer on any property if that is an option.

Is the financing method even up to you or is it just what the loaning institution is willing to do? Are there other options besides a balloon loan or conventional?

Are there factors? Like whether the rental will be or is held in an LLC? Does the borrower's collateral matter (like using equity from another property vs cash)? Does the amount of the loan matter? Is a conventional loan simply based on trust established between the borrower and lender? Is conventional only available for a live in landlord? Are there regulatory issues at play here?

I'm a mess on this subject. Anything you understand, resources you can point me to or educational courses would be appreciated.