Live in CA, Invest in AL & MO

[Rob Fuller]

I have been investing in Real Estate for the past 6 years.  I buy & hold most deals, but occasionally I flip.  For example, this month I close 20 SFRs and only one is a flip. The remaining 19 will be renovated and rented.  I am looking to expand my investment business so that in the first quarter of 2016 I am buying 40-50 properties each month. I hope to buy 400-500 properties next year.  Some people say investing out of your area/state is a bad idea, but for me it was the only way for me to succeed as the area I live in is incredibly expensive and competition with other investors makes acquiring properties very difficult and far less profitable.  

[Rob Fuller]

@Joe Moore  There are a number of ways to finance that many deals.  I have used a few.  

I started buying properties shortly after the crash with my cash on hand and personal credit (option 1, up to 10 properties, although at the time it was hard to get more than 4). After you hit the maximum, many banks or commercial mortgage brokers will refinance the package of properties (option 2).  

But I am somewhat impatient with the speed of the process of doing it on my own, so I began taking capital partners. I have good credit, so I didn't need their credit, but I sometimes still use it if they have a high net worth (>$20M) because the loans they can get are a much better rate (~2.5%-3%) than one I can get. Because their rates are better, the ROI can be much higher as well. It is worth bringing them on as a partner, even if they don't contribute any more than their balance sheets to back you because you will make more money as well.

To answer your question as to how I get financing on that many properties now, I use lines of credit and hard money lenders.  I still use capital partners as well to provide the 20-35% down payment (depending on the lender).  There are a number of companies that will provide lines of credit when you have a proven track record.