What Now???
Another quick question regarding commercial loans. I have several multi-unit properties and am now looking at going into larger apt buildings. Here is the info:
1. Seller is selling 2 6-unit buildings for 250K and is willing to carry 200K of each at 7% intrest only, 5 yr balloon.
2. Wants 50K down for each. (I have a commercial loan to cover this)
All the number works. I haven't done this type of deal/loan before, everything to this date has been financed and pretty straight forward. I know this is done all the time, but I want t make sure I'm not missing anything. Any tips from you folks that have done this before? i.e. any special paperwork I need to be aware of? any pitfalls in doing this kind of deal? I have a good lawyer who will look over the paperwork and a good CPA. Thanks for your time and inputs.
Sounds like you have everything lined up. There is a great "analyzer" on this website. I beleive it is under "tools" at bottom of page. You just want to make sure you are going to have a good cashflow. Look to see if there is any major maintenance ahead. have they neglected anything. Has seller allowed enough in expenses to cover maintenance. If they haven't this will dramitically effect your NOI. When you find a good commercial deal, it seems you need to put it under contract with a sufficiant due diligence period.
Let us know how it goes.
Oh, you may want to post this in "commercial" section fo forum
So the seller and your lender are comfortable w/ a 100% LTV is I did the math right?
That's an AMAZING deal.. infinite leverage as you have 0 in the deal.
Did I miss some math?