How to Pick a Rental Property Lender

Mike: Hey, it’s Mike Hambright from Flipnerd.com and we have a quick VIP tip to share with you from Steve Bighouse, who’s going to share a tip on how to pick a rental property lender.

Steve: I think what’s really important to anybody that’s looking at buying investment properties, they want to deal with somebody that’s very knowledgeable that knows what they’re doing, because that’s the secret as far as financing goes. And not only just the initial qualification, but looking at where are you going to be at presently today? What does your financial picture look like here? Where do you want to go? I mean, what’s the number of properties that you’re seeking to buy? Is it something that you’re looking at buying and flipping? Buying and holding? Tell us what you’re going to be able to do and kind of map that out for them.
And really know what the game is as far as buying rental properties, understanding what it is for a client to buy an investment property and why they’re doing it. How do you take them through that maze as far as financing to get them where they can do that? Unfortunately right now, a lot of the loan officers aren’t well versed in investment property financing. And so I think it’s really important that people do that. A lot of clients, let’s face it, interest rates, fees, they’re always important to everybody because I mean that’s just what the name of the game is.

But at the same time I think what’s really important too is, one, being able to get interest rates and fees that are acceptable to you and are the norm within the industry. Maybe off a quarter, three-eighths of a percent, not a big deal if you’re financing a $50,000 property. But I think what’s really important is finding that knowledgeable lender that can help you through that maze. And unfortunately, there are not a lot of us out there that can do that. I mean, when I go to some of the conferences I do, there are three of us that are consistently sitting up there on the panels.

Mike: Yep, yep. Lenders, like anything, it’s important to work with somebody that kind of understands what your vision is and that can help you over and over again.

Steve: A lender needs to be a resource, needs to be a part of the team. If you’re going to buy investment property, that’s one of the pegs that you need to fill on that team. You need to know that you have a lender out there that you can reach out to and say, “Look, if you’ve got a question on finance or have an issue here,” that I can pick up the phone and send that e-mail to that lender and they can respond back to me and feel confident that the answer that he gave to you is the correct answer.

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