Bank and credit union loans are generally defined as “portfolio lenders,” or lenders that hold the loans on their balance sheets.

I am not a licensed GC but I have experience building spec homes that I could show a bank Fine paying a higher interest rate on the construction period of the loan, but would like to be more in line with traditional mortgages rates on the perm portion (although fine paying slightly higher if I avoid closing costs for a second loan)Do y’all have any recommendations on specific types of loans for this or specific banks I should talk to?

Typically lenders would request 2 months of rental receipt + bank statement showing the tenant paying the 2 months of rent to the landlord OR 1 months of rent + security deposit if the lease just started.

In normal operations and stable markets, the bank margin is typically about 160-180 bps above the fed funds rate, however we are currently seeing them build close to 300 bps of margin which tells me they are still expecting volatility in the bond market. 

@Jennifer TaylorYou can create a new LLC, a new IRS Employer Identification Number and open a new bank account just for the cottage.

When I sell these two facilities, he is going to pay off his very high-end home, plus all of his other debts and put a ton of cash in the bank. 

As long as you are both on title, I don't think it is a problem-but ask the bank. 

After-tax dollars in your bank account are used for rent. 

I've generally only looked at local banks for local apartment buildings, and Chase also has often had good terms.    

I would say conventional / FHA (bank loans) would be your best option.