7 Apt Unit - Question for Lenders

Financing, Hard Money Lenders, Private Money
1

I am looking at a 7 unit apt complex (well actually it looks more like house). The listing price is $250,000 and it grosses apx. $2900 a month in rent (we could probably purchase it for less - it has been on the market for a while). I have never looked into commercial lending - but for this price I would consider a purchase (I have been looking for 3 families listed at this same price).

How does commercial lending differ from residential lending. What are the qualifers that lenders use? We have great credit, but not enough to put a huge % down.

Any thoughts?

2

If you credit is very good, you can put 10% down.

3

the prequalification process is a bit different from residential. The underwriters will look at if the units are occupied currently, they look at utilities for each unit, its gets pretty detailed before an approval is made. But a 7 unit for 250 sounds like a decent investment. Good luck!

4

Snobank -

10% down - are these traditional lenders? I thought 20% down was a hard & fast rule in commercial lending?

Any suggestions on where to look for a 10% down commerical loan?

5

The rates will be significantly higher with only 10% down but these loans do exist. They will do an 80/10. Most lenders do ask for 20% but a good broker will find you 10% down if you have the credit and assets. Where is the property located?

6

You can get 10% down, with conventional commercial financing. You would need at least a 680 mid-score. Otherwise, pretty straightforward.