Your situation reminds me of a story I heard not to long ago.
Seems there was this man who wanted to buy a refridgerator and he went down to the Sears store. He found the refridgerator he wanted and proceeded to purchase the refrigerator with his Sear’s Credit card. Well the clerk started filling out the papers and discovered he had used up his credit line already. After a brief discussion, the clerk said she would talk to her manager and see if Sears could extend his credit so he could purchase the refrig. Well the manager came down to the floor and informed the clerk it was out of her hands and walked away.
Now, the man looked at the clerk and said, “Do you believe that I’m not going to buy a refridgator today just because Sears won’t sell me one?” And the Clerk looked back at the man and said, “No, I believe you’ll have one before lunch time.” And the man responded, “Your exactly right.”, and left.
The lesson you should learn form this is: I’m going to continue to buy homes and weather the bank wants to do business with me or not is fine. But the bank is going to miss a whole lot of business if they stop now. And sometimes you have to explain it to them. They need you as a customer, you don’t need them as a bank.
I need some help refinancing a existing rental property that I have. I have been buying rental properties and getting 80% loans(6 of them) thru Bank of America and have never had any problems obtaining financing. Well about 8 months ago I found a house that was priced right and required a quick close so I offered all cash and paid for the house. Well I decided it was now time to borrow 80% against this house and get my cash money back and do some more deals. I called my banker lady told her I had a house with no existing liens and need to refinance it(this is not the first one I have refinanced with her). She took the necessary info and I expected to hear from her in a couple of days,well I did. She said “I am so sorry but we are NOT going to be able to help you because the bank only allows a person two have 2 rental loans and you already have 6 with us”. ED GARCIA WARNED ME THIS WOULD HAPPEN.
Needless to say I was upset about it, I have 6 loans with this bank and they have paid like clockwork for several years, never been late. Besides my total outstanding loan balance is very small. I could easily have bought bigger properties and had a much bigger balance, but the problem had nothing to due with how much I had borrowed, it was all the fact the I had 6 loans with them. In fact she said “We will be glad to make you a 2nd loan on your primary residence”. Thats not what I wanted!!!
So now to my question
How can I now refinance this house and get my cash out
Go to another bank(same problem will show eventually)
Washington Mutual gave me my 4th, 5th and 7th mortgage loans, while Country Wide Home Loans gave me my 6th, 8th, 9th, and 10th.
Countrywide Home Loans will allow you to have ten rental property mortgages before they say no to the next one. They will also originate only four mortgage loans for you.
Try Washington Mutual. They are a portfolio Lender. I have 14 single family rentals. 4 of my loans are with them. They dont care about the number of loans you have as long as you can qualify.
Judy
TedB,
Is your “banker lady” just a loan originator or a bank VP? I have found that (most) loan originators are very “inside the box” - type thinkers, either by nature or on orders. If there is a written rule, they are going to follow it, to the letter, no matter what. Go the the VP above her. He/she will have the authority to recognize you as a valuable customer and the intelligence to know you WILL buy that house, whether using their bank or a competitor’s. You may not get the best available rate, but maybe you can get some “trash fees” waived, instead.
Ted,
I’m an underwriter for a large mortgage bank. The problem with having too many loans on investment properties is a FNMA Guideline, not bank related. FNMA states that to qualify, a loan applicant can have a maximum of five mortgages (1 on their primary home, and up to 4 on investment/second homes). You will run into this problem no matter where you go if your trying to get a FNMA rate (lowest possible, this includes Freddie Mac). The only way to get around this is to go to a subprime lender that doesn’t deal in FNMA loans (of course the % rate will be higher) Hope this helps. Good Luck
Ted,
I just spoke with a lender yesterday about this same situation. They informed me that I could have up to 4 loans with them because it was all their loan buyers would allow.
You see, this lender sells all their loans to the same company, which allows only four per person.
After further inquiry, the lender began to tell me that if I needed a 5th or 6th loan, he would just have to go to a different loan buyer with the package.
Maybe you should see if this situation is similar to your bank. You may need only to ask the right questions.
If all else fails, call Ed Garcia at 1-909-944-0199