Scaling - How to Successfully Obtain Multiple Mortgages?

[Jeffrey S.]

I apologize if there is already a similar post regarding this topic. I did a cursory search and did not see anything on point. I am wondering how investors obtain multiple mortgages for all of their properties (i.e. 50 to 100 or more). Do banks, credit unions, or the like balk when they realize you already have 50 or more mortgages on other properties? Or is this where a 1031 exchange is used to sell some properties for ones with more units (i.e. apartment buildings)? I realize these may be 2 separate questions and I apologize for that. Any help is appreciated. Thank you.

[Andrea Weule]

I get commercial/portfolio loans with small local banks/credit unions.  I look for banks that hold the loans in house (don't resell on the market).  They focus more on the value of the asset and less on you specifically.  You'll still have to personally guarantee the loan.  Yes, many of the loans are on 3 - 5 year balloons.  Most of the time you don't have to refinance, they just adjust the rate at that time for another 3 - 5 year period.  This is because small local banks do not have the carrying power that a big lender has if the interest rate should go up greatly.  I've been at it for over 10 years and haven't had an issue with the rates jumping.  

After a certain aggregate (amount they'll lend to you), for example $1,000,000 in loans they often will not lend further.  The key here is to find a second bank or I've taken out a life insurance policy and named the bank the beneficiary.  This often allows the bank to lend you more funds beyond the aggregate.  

Best of Success!