Scenario: $30K down for $300k Commercial Loan

General Real Estate Investing
1

Hi all,

Would like to buy my first commercial property. 7 units, 2 beds per unit, 800-900sqft. asking price $300k. Building is 100% occupied, renting for $550 per unit (could easily rent for $625). - 2 blocks from large college campus. I believe the building would appraise for $425 - $475k. No figures on monthly operating expenses.

I have $30K to put down.
My credit is 550

Does anyone know what my chances would be of obtaining a loan at a fair rate?

Please post any questions if you need additional info.

Thanx

2

you might try posting here if you dont’ get a response at this site

http://www.brokeruniverse.com/grapevine/

3

10% down is not going to cut it with a score in the 500’s…even with hard money.

I suggest working with someone on getting your credit repaired and then addressing this issue.

4

Or Robbing a bank…

Just kidding! I do not condone robbing banks. But yes, you will need a larger down payment than that.

5

Can you get a seller second???

Mike Orlando FL

6

INCOME & EXPENSE DATA
Vacancy & Collection Percentage:
Annual Gross Income (PGI):
Laundry income:
Other Annual Income:
TOTAL ANNUAL GROSS INCOME:
Vacancy & Collection amount:
EFFECTIVE GROSS INCOME (EGI):
Real Estate Taxes:
Property Insurance:
Flood Insurance (if applicable):
Off-Site Management:
Combined Utilities:
Trash Removal:
Pest Control:
Janitorial:
Res. Mgr. salary:
Repairs & Maintenance:
Interior & Exterior Dec:
Cleaning Expenses & supplies:
General & Administrative:
Association Fees:
Professional Fees (Legal & Audit):
Miscellaneous:
Other:
Replacement Reserves:
TOTAL EXPENSES:

Expenses as % of EGI

NET OPERATING INCOME:

ANNUAL DEBT SERVICE:
DCR:
Just do it!

7

As a real estate investor myself, I look for opportunity like what your offering all the time. Heres what I mean.

I have credit and experience owning investment property, this is good to the bank.

You have the equity dollars, the riskyest layer of the financing equation.

As a mezzanine lender, I (or for the purposes of this posting you undoubtedly have someone in your market like me, if you dont ill find someone) will put up some more down payment as a second mortgage, you pay me (or them) interest and grant a small equity position.

I am protected by the following:

you are going to work hard to protect your down payment
if you dont make payments, i create in your contract an agreement to take over your position in the property if you default

what i descripe has alot of similarity to a “subject too” deal people refer to in these postings, only in this case the deal is layed out on the front end

if all goes well, i (or someone like me) gets interest, a small equity kicker and someday you refinance me out.