April 9, 2020 | By: LendVer Staff –
The Government and the lending community have been desperately scrambling to get disaster relief loan funds into small business owners hands under the newly minted Paycheck Protection Program (PPP). At the same time, commercial and investment residential real estate lenders are closing their doors, and locking up their coffers in droves. So which lenders are still funding investment property loans?
Who is Stepping Up?
The same thing is happening this time, that happened during the last recession (yes, we are in a recession despite what you may have heard otherwise). Private money lenders are stepping in to fill the void that is now absent conforming and non-conforming lenders. Private money lenders (aka bridge lenders) utilize their own capital, or the funds of high-net-worth individuals or corporate investors, to make low leverage collateralized loans for an above average rate of return (i.e. their interest rates are higher than a conforming lender’s). A private lender will usually make a loan less than 65% of a property’s value, and it will want a clear exit strategy for its loan (it doesn’t want to loan to own).
Where Can Private Loans be Found Now?
Kiavi is America’s largest fix-and-flip lender and focuses on investment residential fix-and-flip, bridge, and rental property loans. Kiavi’s interest rates start at 6.625% and are available for a short term of 12 to 24 months, or a long term up to 30 years. Kiavi has funded in excess of $7.8 billion spread out over 35,000 investment residential property projects. Kiavi is a nationwide lender currently providing loans up to $3 million in AZ, CA, CO, CT, DC, FL, GA, IL, KY, MA, MD, MI, MN, MO, NC, NJ, NV, NY, OH, OK, OR, PA, SC, TN, TX, VA, WA, WV.
Check your rate with Kiavi in minutes
Conclusion
Other than deferment and/or forbearance periods for government backed loans, there has been little information from Washington that there will be relief for investment property owners. Nationwide stay-at-home policies (which are absolutely necessary) are resulting in a significant decline in on-time rent payments, making it increasingly harder for investment property owners to pay their mortgages. Until the economy gets back on track, securing a private loan to access the equity in your commercial or investment residential real estate to hold you over, is a wise move.
Don’t hesitate to contact us if you are unsure of which financing option is the right choice for you, or if you need additional lender recommendations beyond those mentioned in this article.
Interested in accessing the best residential investment property financing? Contact our recommended best residential investment lender KIAVI.