Investment Real Estate Mortgage
Unlimited Cash Out, Non-Recourse Residential Real Estate Investment Program
What is Ventury Capital’s Investment Real Estate Mortgage Fund?
Our residential property finance program is a specialty finance program dedicated to providing mortgage debt financing to investors who own multiple residential rental properties.
What does this financing accomplish?
The investment mortgage real estate program offers investors 5 and 10 year mortgages on portfolios of residential rental properties with a minimum of 5 units. The Investment Fund can either refinance your existing portfolio or finance the purchase or portfolios of rental investments currently under lease.
What property types does the program lend on?
The Investment Real Estate Mortgage Fund lends on a wide range of residential rental property types including single family homes, 2-4 family homes, town homes, condominiums, and multifamily apartment buildings.
- Properties must be owned for investment purposes and therefore may not be occupied by the borrower or a member of their family.
- Section 8 housing is permitted under the Investment Real Estate Mortgage Fund
- Properties must have initial leases in place 6 months before units can be leased on a month-to-month basis. Weekly or vacation rentals will not be accepted.
- The Investment Real Estate Mortgage Fund does not lend against assets that are held on a ground lease or with lease purchase options.
- The Investment Real Estate Mortgage Fund does not lend on co-ops or manufactured housing
What is the benefit of the Investment Real Estate Mortgage Fund versus traditional residential home loan?
The Investment Real Estate Mortgage Fund is specifically designed for residential rental properties. Our entire team is solely dedicated to servicing this market – we do nothing else in this department.
- The Portfolio Mortgage program takes a commercial real estate approach to underwriting loans. As a result, we lend primarily upon the value and cash flow of the underlying collateral. We do not review the personal debt to income ratios of our applicants.
- Fannie Mae and Freddie Mac currently limit the number of investor home loans per borrower to 4-10. The portfolio mortgage program has no limit on the number of loans per borrower
- Individuals are the only acceptable borrower for traditional residential loans. In contrast, the investment real estate mortgage fund requires that all properties be owned by a single newly formed limited liability company or other corporate entity which enables borrower to limit their personal exposure to property related liability claims
- The Investment Real Estate Mortgage Fund offers a non-recourse lending program for loans greater than $3,000,000. Traditional residential loans are full recourse to the borrower.
- The real estate investment program allows our borrower to sell the equity in the corporate entity that owns the properties serving as collateral for the loan to qualified borrower during the loan term without repaying the loan. Traditional Residential loans have due-on-sale requirements.
- The Loan Program does not limit cash out refinancing loans. Traditional residential lenders frequently limit cash out refinancing loans.
Loan proceeds are determined by the Investment Real Estate Mortgage Fund underwriting team after thoroughly analyzing the value and cash flow of the assets being used as collateral for the loan.
We offer lending products up to 75% loan-to-value that maintains a 1.2 debt service coverage ratio and loan sizes from $500,000 to $50,000,000
What Kind Of Products Does The Loan Program Offer?
- Loans from $500,000 – $5,000,000 (minimum properties)
- 5 and 10 year fixed rate term
- Up to 30 year amortization
- 75% LTV (Loan-to-Value)
Institutional Lending Program
- Loans from $3,000,000 to $50,000,000
- 5 and 10 year fixed rate terms available
- 5 year floating rate term available
- Up to 30 year amortization
- 75% LTV (Loan-to-Value)
Can I Hire a Professional Property Manager To Manage My Portfolio?
Yes. Borrowers which do not wish to self-manage their properties can engage a qualified professional property management company.
Can I Manage My Own Properties?
Yes. Borrower may self manage their properties with approval from the Investment Real Estate Mortgage Fund. Approvals are based on the experience and background of property manager. Generally, a minimum of 2 years property management experience managing at least the number of homes that the Investment Real Estate Mortgage Fund is financing is required. Borrower can also complete an approved property management course to self-manage their properties.
Does The Investment Real Estate Mortgage Fund Require Reserves?
Yes. Monthly reserves are required for taxes and insurance in the same manner as many traditional loans. These reserves are used to pay tax and insurance bills as they come due. Capital expenditure reserves will be collected on a monthly basis to pay for significant repairs and maintenance expenses on the properties (i.e. roof, HVAC, appliances, etc.). The borrower can draw these reserves to pay for expenses.
What Type Of Entities Can Qualify As Borrowers?
The Investment Real Estate Mortgage program requires that all properties be owned by a newly formed corporate entity. Closing costs can be significantly reduced if a Delaware LLC is used in conjunction with the standard form by the Fund organizational documentation. As the Investment Real Estate Mortgage Fund is a commercial lender, no loans are made to individual consumers.
Can I Finance Properties That Are Not Currently Leased?
Yes. The Investment Real Estate Mortgage Fund requires that financed portfolios be at least 90% leased at closing. Properties that are not leased must be in “lease-ready” condition. As your property cash flow improves as more properties are leased, your maximum loan proceeds may be higher if a higher percentage of your properties are leased.
Are There Minimum Season Requirements On Ownership?
No. There are no minimum seasoning requirements the applicant must meet before applying for a loan with the Investment Real Estate Mortgage Fund.