| Posted by: quinnth1 Nov 15 2004, 11:10 PM |
I am currently attempting to invest in my first rental property (age 27). I have decided that an 80/20 INTEREST ONLY loan would be a good way for additional income.. especially in the expensive market of chicago....
I found a great money producing property about 1.5hrs outside of the city that is only $220k. I was very excited until I was educated by my mortgage broker that a 6 unit as I was looking at would require a commercial loan which is much more expensive and requires a 25% down payment.
The property is so cheap that my own salary could support it, but I do not have the 25% DP, and am not sure how hard it is to get a commercial loan. My mortgage broker didn't want to touch it.
With all of the creative financing techniques these days, is there a way to get around a large downpayment for commercial?
Can I get an interest only on a commercial?
Is there away to get around having to even use a commercial loan, and somehow obtain a normal mortgage for the 6 unit property?
I appreciate any advice you could provide to this eager novice. |
| Posted by: loanuniverse Nov 16 2004, 12:36 AM |
With all of the creative financing techniques these days, is there a way to get around a large downpayment for commercial? Yes get the seller to do partial financing. If you can get the seller to carry even a $20,000 note that should be enough to take you over 25% in the eyes of the primary lender, as this note will be subordinated.
”Can I get an interest only on a commercial?” I have not seen it. Then again my experience is limited to bank lenders.
”Is there away to get around having to even use a commercial loan, and somehow obtain a normal mortgage for the 6 unit property?” Hmmmm, I don’t think so. Financing up to 4-units as residential if one of the units is owner occupied is the standard.
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| Posted by: Commercial Lender Nov 26 2004, 12:16 AM |
| Depending on a few variables; you could get 80% LTV, get a seller 2nd for 10% and come in with 10%. The debt service on the building would hav eto hold up. Leme know if you have any questions. Thanks. |
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