Hello,
I just bought my first apartment building…closing at the end of the month. It is a 12 unit for 382,000 in massachusetts. The building is 100% occupied and has stable rental history x 5 years with this owner of 95% or greater occupancy. THe cap rate is 13%. The seller is carrying 10% purchase money and my llc is putting up another 10%. My llc portion of the money came from unsecured personal lines of credit. We have 85k in them and will use about 55k with down payment and closing costs. The seller is giving two months rent + escrow amounts into account at closing giving us about 18,400 + my personal lines of credit of about 25-30k. I had always understood that I could apply for a business loan for expansion based on what I have in my business account and they would grant 2-3 times the liquid cash amount. Please clarify if this is correct? Also, how long does the money need to sit before I can apply for one single business loan and what is the interest rate of the loan. The credit scores of the 4 members are 800, 767, 735, 651 if there is a personal credit check. I would like to pay off the personal lines of credit and start using just one business loan to expand the business. All thoughts and assistance would be helpful. Thanks
Kris Rench
Recoupe Property Group, LLC