I’ve found an office property that is currently listed for $348,000, its a single unit suite that is occupied and lease is in place until 2009.
I have just created an LLC company that I envision will eventually hold this property.
My LLC company currently has $3,000 of equity. Myself and one other member are a part of this LLC, and we’re knee deep in student debt so our equity “out of pocket” is limited.
We have not done any deals to date because we’re trying to get over the “barrier” of the first deal. I have a good understanding of all the costs associated with a commercial real estate transaction (closing, broker, appraisal, engineer, etc.). Is there any way that we would be able to borrow enough equity to cover these “up-front” costs, as well as, the down payment?
Knowing that a lender won’t give equity to a new LLC we are both willing to put up personal guarantees if needed, but I’d like to see what suggestions people that read these forums may have.
The two members of this LLC have outstanding credit, and are currently employed with solid W-2s.
Would taking out a home equity loan to cover all costs and down payment to secure financing for lets say 80% of the property be sensible? Then refi all of the debt with one lender, therefore, not have the outstanding equity on a primary home and consolidating all of the debt?
Thanks in advance for any and all input on the matter