Ok, I need help.
I need to know how to approach the bank with a deal I stumbled upon while searching through the MLS. I have an investor friend (Canadian) who has 150k he wanted me to find some condos and a 4 plex for him. While searching for 4 plexes, I found a string of what looks to be an apartment complex of about 200 Units that have been broken up over the years into groups of 4 plexes. There is a central pool and amenities as well as an HOA fee. Well there are 10 of the 4 plexes listed on MLS (50 total) all for around 90,000. A few are going to auction and most are short sales. They sold for around 325k during the peak so it looks like all the owners walked or are walking away. Most of the units are rented right now. Here are the numbers, what I need to know is how I approach the bank for the financing.
Avg Rent $600
Monthly (per 4 plex) $2400
Total after 10% vacancy $25,920 (annual)
HOA (common areas) $5184
Now a full price offer on each would amount to $933,000. I have my friends 150,000, I have another rental worth about $140,000 free and clear that I plan on leveraging for $100,000. I have $27,000 in a silver EFT (liquid), I have another $9k in physical silver(liquid) and only a couple thousand in the bank, (just had to pay taxes and CPA, and like to park my cash in silver). I also have $14k from my brother who may be interested. Total of about $300,000 (mostly liquid cash) So I am looking at putting 30% down or $279,900. Loan would be $653,100 for 30 years at 7%. Is this realistic? Wells Fargo owns 4 of the loans so I was thinking of going straight to them and asking about a package for 4, maybe get them a little cheaper. I need some comments and help from the veterans if this looks feasible and if so how I can present to a bank. I want to look professional and have all my ducks in a row, before approaching. I have a Real Estate business established for 2 years to support asset protection and the like. Would the bank do a blanket loan, or turn it into a commercial loan. Any help is appreciated.
Canuck Living in US