I just put an offer in for 3 seperate 4 plexes which was accepted by the seller. The offer was for $400,000 which would be paid with a 85% conventional loan at 8.3% and the seller agreed to carry back the remaining 15% at 6.5%.
I was told by my 1st mortgage lender that the seller had to charge a higher int rate than what was being charged for the 1st. Now we are having to pay the sellers 2nd at 8.5%. Does anyone know wether or not this is correct, or is the 1st lender incorrect.
EZ,
It is standard for a 2d mortgage to have an interest rate higher than the first, but I’m not aware of any requirement. I would ask the lender why. When you find out why, let us all know. Thanks
Good luck,
Ray
8.5% interest rate on a commercial second lien is in the ball park. Nothing crazy for sure. Stick with it.
Nate
I am not aware of any law that requires the second rate to be higher than the first.
There may be lenders that can offer you the full 100% CLTV at very competitive rates