Where to go after purchasing 8 rental properties

Question

Since 2016 I have purchased 8 rental properties in Florida. I have good tenants and the monthly return on all the properties is good. The loan officer I have used for the purchase of all my rentals and primary residence advised me that I am at the point where I can no longer qualify for another property because I do not have enough money is reserve and making much less money due to lack of work from the Coronavirus. To move on for the purchase of additional properties I am not sure if I should look into an equity loan on my primary residence or perhaps flip one or two of my properties. This is all new to be and any advise would be appreciated.

Thanks! Fred

Jon Shoop · Answer

Look into doing a 1031. Sell one property and use the proceeds to roll into buying two more rental proeprties. A 1031 allows you to roll previous real estate sale money into a new real estate venture without having to pay sales taxes. At least that's the layman's term.

James Hamling · Answer

@Frederick Laura sounds like your ready for the next step, which is an evolution and with that new lenders who best fit where you are going not where you were.

I would suggest starting by wrapping those properties into a singular commercial mortgage, that alone will press rate even lower freeing up more cash flow.

In reviewing banking entities for best fit on doing that (I would have a portfolio pack together that I take bank 2 bank with me to present) I would also discuss if they are a good fit for moving forward, and be direct "I would like portfolio lending, a $________ line of credit account for acquisition, from which we will later finance those questions into additional commercial mortgages in a "rinse & repeat" fashion.".  I have found your best chances of success in those interactions is to know what you'd like to have, and communicate that directly and fearlessly, and they will let you know what you can do within that.

Once you have a portfolio lender the funding approval will be a vastly different experience.

Frederick Laura · Answer

Really appreciate all the responses that have come in. Fred

Frederick Laura · Answer

Thank you Jon!

Robert J. · Answer

Portfolio lenders can always bundle all those and give you a loc for equity. You can pick some up in a spouses name. You can just apply for a business line of credit using your experience and success so far in RE. You can find a private money partner. Um... i think there's more

John Edwards · Answer

@Frederick Laura shop around...and while doing that build up your reserves.

Nick C. · Answer

Find a new lender. There's plenty of smaller, local banks down here that are lending. Call every one of them until you get a yes.

Where to go after purchasing 8 rental properties

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