can 5 separate 3 family homes be financed under a commercial loan
if so how can this work and if not
is there some creative way to finance these 5 properties.
Also could i just get a business loan or line of credit and buy these properties
open to any suggestions
Hi,
You can potentially get non-conventional commercial multi-family financing for this property group. I take it these 5 triplexes are all next to each other or on a culdasac. The lenders will probable only loan 65 to 70% of your purchase price as all lenders are loaning less today to mitigate risk.
You can get some support on down payment by requesting the current owner carry back some financing as a second. Ask the lenders what percentage of the transaction numbers are exceptable. Calculate an exceptable interest rate for the 2nd that works for your income / expense projections.
If you find the right commercial lender ask that the 5 properties be granted the ability in writing to sell off units one at a time as individually deeded properties thus allowing a exit strategy and ability to pay your loan down by percentage of each sale.
If you do not ask for this you will have a 15 unit loan that the only way out is to continue to sell the property as an apartment complex, however if the market changes it may be significantly more profitable to sell these off as Triplexes!
Good luck,
GR
thanks gold river