I have an oppotunity to purchase a portfollio of real estate in the West Michigan area. There are various properties including singles, duplexes, multi-units, etc… Fully rented, the portfollio takes in about 30K a month. Owner is willing to carry some funding back. What is the best way to purchase this portofolio, looking at price of 2-2.5 million. Credit is very good (720) and already have some investment property.
Sounds like you may be able to use a wrap for this project, but I would bet that the seller is going to want to get something upfront for the deal.
95% CLTV (financing) with a seller carry back will work on that.
How does a CLTV work?
CLTV is the ratio of the fair market value of a property to the loan balances of ALL mortgages. Here’s an example CLTV calculation for a property with a 2nd mortgage (owned more than 12 months):
Appraised Property Value: $350,000
Mortgage Balance: $200,000
Second Mortgage Balance: $25,000
Add $200,000 to $25,000 (balances of 1st and 2nd mortgages) for a total of $225,000.
Divide $225,000 by $350,000, and you get 0.64 or 64%CLTV