Can I get a balloon NON OWNER OCCUPIED mortgage loan for my real estate investment property?

[Steve S]

Hi guys,

I am new to BiggerPockets user, but I have been actively reading the forums about real estate investing. In my scenario, I am looking into buying a brand new condominium with no sold units yet. I am planning to rent out this unit in the condo. I know that conventional Fannie Mae mortgage requires 70% of units to be sold until they will consider giving me a loan. I was wondering if I can obtain a balloon NOO mortgage for my condo. Once the note is due, which would be 5-7 years, I believe all the units will be sold and then I can refinance and do a conventional Fannie Mae 30 year fixed rate loan. Or I can sell the unit before the note is due. Is there a such thing as a balloon NOO mortgage? Does balloon mortgages only apply to primary residence? Can I also make additional payments to my principal each month in a balloon mortgage loan?

Any opinions and advice greatly appreciated!

[Jon Holdman]

Yeah, its not exactly straightforward, unfortunately.

Start with the page I linked above:
http://www2.fdic.gov/IDASP/

Click on "Find Institutions" down the page a little ways:
http://www2.fdic.gov/IDASP/main.asp

On this page you can specify criteria. I'll put in Colorado for the state and leave "Sort by" set to "Total Assets". I want to look for smaller banks. Click "Find"

That gets me a list of banks, largest to smallest. The first column I see is "Cert" and has a number. Those are clickable links, so click one.

Now I see a screen that has a blue band across the middle with "Information Gateway". Below that is "ID Report Selections:". I choose Assets and Liabilities - % Assets. This will show me percentages. Choose "Assets and Liabilities" to see actual numbers. Now click "Generate Report" over to the right.

This generates a balance sheet for the bank. Item 6 (number may vary, I saw 6 on the couple I checked) is "Net loans & leases". That's a clickable link. Click it.

This generates a listing of the bank's loan and lease assets. A bank considers a loan to be an asset. This will break out the types of loans the bank has made. Look for a bank that is making the type of loans you want. You should see two columns of numbers. I see Dec 2012 and Dec 2011. If the number is increasing for the type of loan you want, all the better.

Sorry, I know it would be easier to search for "show me banks in my area that are making investor real estate loans", but its not that simple. Back on the very first search screen, there is an criteria called "Asset Concentration Hierarchy" and one of the choices is Mortgage Lending Specialization. You might try that to narrow down the choices.