Cross-Collateral Loans for Real Estate Investors
Need to close on your next deal but short on cash? Cross-collateral financing from Rain City Capital lets you tap into the equity you've already built across your portfolio. Whether you're buying at auction, starting a new flip, or funding ground-up construction, we help you structure loans that utilize your existing properties as additional security, allowing you to move quickly without draining your bank account.
What Is Cross-Collateralization?
Cross-collateralization is when you use multiple properties to secure a single loan, or when one property backs more than one loan with the same lender. For real estate investors, this means you can leverage equity from rental properties, completed flips, or other assets you own to fund new purchases or renovations.
Let's say you own two rental properties free and clear, and you want to buy and renovate a distressed property. Instead of coming up with a 10-20% down payment in cash, we can structure a cross-collateral loan that uses the equity in your rentals as additional collateral. You get the funding you need, and your cash stays available for other opportunities.
Cross-collateralization works well for active investors in specific situations:
When Cross-Collateral Loans Make Sense
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If you're doing multiple fix-and-flip projects or following the BRRRR strategy, cross-collateral financing pulls equity from properties you already own.
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When you need to close in days, a cross-collateral structure can eliminate the cash requirement and speed up approvals.
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Use equity from completed properties to fund ground-up construction without tying up all your liquid capital.
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Cross-collateralization gives you the flexibility to move quickly when a great deal comes up and you want to hop on it.
Benefits of Cross-Collateral Financing
Working with Rain City Capital on a cross-collateral loan gives you several advantages:
Lower cash to close: Use equity instead of cash for down payments and closing costs.
Faster approvals: We focus on the combined value of your assets, beyond just your credit score or income documentation.
Increased buying power: Leverage multiple properties to qualify for larger loan amounts.
Flexible structures: We tailor cross-collateral loans to fit your specific deal and timeline.
Understanding the Risks
While cross-collateralization offers powerful benefits, it's important to understand what you're agreeing to. When you cross-collateralize, all properties in the loan structure are tied together. If you default on the loan, the lender has a claim on all the collateral. That's why we work closely with you to make sure the deal makes sense and that you're comfortable with the terms before moving forward.
How Rain City Capital Structures Cross-Collateral Loans
We keep the process simple. First, we review your existing properties and the deal you're pursuing. Then, we run the numbers to determine how much equity is available and structure a loan that works for your goals. Our underwriting focuses on the after-repair value of the new property and the combined loan-to-value across your portfolio. Most fix-and-flip loans close in days, and we offer 12-month terms with rates typically ranging from 10% to 12%, depending on your experience and the project.
Get Started With Cross-Collateral Financing
Ready to put your equity to work? Rain City Capital has funded billions in loans for real estate investors since 2009. Our team understands how to maximize cross-collateralization as a strategy and how to structure deals that help you grow your portfolio without unnecessary risk. Apply online today!