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apartment unit


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#1 Guest_Jon_*

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Posted 03 September 2004 - 01:27 PM

I am looking to buy either a fourplex or an apartment building. I found a 12 unit apartment complex but I don't have the 20% down for a commercial loan. Any advice on how I could obtain this property, or should I stick with the fourplex? Also, is it true that muli family homes are a lot harder to sell and do not appreciate as much as single famly homes? thanks

#2 loanuniverse

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Posted 03 September 2004 - 02:22 PM

Jon:

If you want the larger property, but lack the down payment, getting your seller to carry a second position mortgage on the property is the key.

Assuming that you have $40,000 for down payment, and that the property is being sold for $800,000, you would need $160,000 for a 20% down payment, but if you can convince the seller to agree to carry a 2nd in the amount of $120,000, the lender might agree to the deal as this would bring the loan to an acceptable loan-to-value.

Of course, the cash flow has to pay for the combined debt service.

Regarding the appreciation question, I wouldn’t know but in my market there is a healthy demand for multi-family properties.

#3 Commercial Lender

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Posted 04 September 2004 - 04:02 PM

As the admins said, seller 2nd is the key here. if you can get a seller to hold back a 2nd for 10-15%, and come up with the 10-15% your self + closing cost, you will be ok!





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