Convincing Banks
Is it possible to run some numbers to a bank's loan officer and to see if they will do some financing for a deal,due to not having any credit to get a conventional loan??
All replies greatly appreciated!!! :-D any
sincerely,
Cashis
Yes. A good banker should be able to advise you if the deal will work (for him)
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Asking a banker is not a bad idea.
Remember two things. The banker is not likely to be the most creative person when it comes to RE deals. They have to protect the bank's money and expect to make a rather conservative loan compared to many RE investors.
If the banker can not do the whole deal can they fund part of the deal? You might find that if they can cover a certain percentage you can find someone else (equity partner, the tenant, etc) to put up the high risk aspect of the deal.
John
Find someone with good credit to do the deal with you for a small piece of the pie. If you can do it alone, fine. If not, bring someone in.
As you talk to the banker and hit obstacles, ask "What would need to happen to overcome that"? and "are there any other possibilities".
At then end say "so we could do this if....." and repeat what he told you. After that it's just a matter of filling in those missing pieces.
By Banker, I hope you mean Independent Mortgage Broker! They have a lot more flexibility than a banker.
Sorry - I mean banker. In my experience a broker is more likely to tell you what you want to hear than a bank, although a broker will certainly help you get the deal done more than a banker.
I do not use brokers any more at all. Once ,as an investor, you establish a relationship with a few bankers, the services of a broker are redundant and raather cumbersome ( for me). I know and repsect alot of mortage brokers, and there are some very good ones out there, unfortunatley there are also some bad ones that are ruining the reputation of the broker.
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You are able to call a banker or a broker with a hypothetical situation and get an answer. PERIOD!!!!
If they refuse to help you than call the next one.
Lori
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Gfous,
It sounds like the bankers are more restricted in what they can do than the brokers. I am interested in hearing more about the advantages of working with a banker rather than a mortgage broker.
Brokers tend to be high on promises and low on delivery. I usually field 4-5 brokers and 2-3 bankers (Countrywide, GMAC, etc.). Even with the bankers, they can't always deliver on what they think they can. The issue is that the person you talk to on the phone knows a certain amount. It is only when the loan starts getting to be a serious thing that the underwriter steps in and you get to find out if the loan is possible at all. I usually chase 2 serious loans at a time, and more often than not, one drops out of the race because they can't do it. (All of this applies to multi-unit properties that I'm interested in)
I was a LO for a large bank for two years and quit due to frustration. All the deals were going to mortgage brokers. Anything that was not cookie cutter loans got tossed out. As a broker I have access to a hundred lenders that each has 20-100 products. Everyone has negative things to say about brokers and bankers alike. Essentially they are the same people in the same industry. The question is not whether to choose one over the other, it’s about choosing the most reputable, knowledgeable person with the most to offer as far as products that meet your needs. Banks will laugh at you if what you bring across does not fit within their portfolio for that quarter. However, banks will beg for millionaire borrowers with 800 credit scores regardless of the portfolio. Check out both brokers and bankers to determine what will keep your deal alive. That’s my humble and biased opinion.
Good Luck!