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Dear Banks, What the heck is going on?!? |
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Category: Current Grade: A- Total Views: 281 Member Comments: 3 |
Posted on: 05/02/2009 Posted by: eric Blog Points: 28 View all blogs >> |
What's the point in paying bills on time to sustain good credit if you can't get loans when you need them?
I can't believe that after we (the taxpaying citizens) bailed out many banks, that they won't give out money. Isn't the way banks make money.. through loaning money and collecting interest?
I don't like the fact that the banks went totally polar opposite from the way they were a couple years ago. Before they were giving loans to anyone with a pulse, doing 100%+ financing. Now, they won't give investors loans without 20-30% down.
I know that the government is a little more strict on the banks with their regulations, but throw me a bone here.
Can't there be a good medium between the two? Maybe on a case by case basis?
Perhaps they could look at an investor's credit, see that he has good credit and no other loans (outside of mortgages), and is current on all bills and then determine what kind of down payment is required? Rather they just see that you're an investor and seeking a loan, then they automatically say you need 25% down, of your own money seasoned for 60 days.
There's no gray area here, just black and white. Kind of frustrating.
Well said Coach. This is not the time to victimize ourselves about the current situation. The rules of the game have been changed on us. To be successful we have to play under the new rules or watch the game from the sidelines. I chose to play and win.
As Coach said there are alternatives available to us that do not require the use of bank financing. Also as Brian said, there are some smaller banks and credit unions that have funding available for transactions.
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Welcome to the World of Real Estate Investing. You are no longer viewed as the good responsible consumer, now you are looked at as a greedy, risk-taking investor (ok, maybe not that harsh, but it feels like that sometimes, lol).
The World is not "fair", if it were then all good people would live to a ripe old age, and all higher educated people would be massively successful. But that is not always the case.
As an Entrepreneur, condition yourself to start thinking solution, rather than spending time frustrated about how things are. The Game is real estate investing, the Feds, lawyers, banks, and politicians make the rules. Learn how to play in them, and around them. But never, never, let them stop you.
Hint: Banks are not the only way to finance your deals (and I'm not talking about high priced hard money lenders either). They are but one of many funding sources. Many people find it hard to believe when I tell them I have not borrowed from a bank since about 1993. Creative financing, subject-to, private investor capital, money partners, are all alternative ways to get unlimited funding for your deals.
When the banks say "no"! Your next question should be, "How else can I get the money together to make this deal work?"
There is a way, there is always a way ... become unstoppable!
Have you tried your local credit unions? I have had great success with them.
-b