BiggerPockets

Hi guys,

I'm looking at some complexes in Texas. One in particular that looks good comes in at 480k, 32 units, really good GRM. What kind of financing can I get on this? I'm hoping to find something in the 20% down range. The seller may be willing to carry back something too.

Andy

When I purchased my 154 units in Garland, TX a few months back, I looked for some financing. It was a joke! I received loan committment and then yanked, from 3 different lenders. I don't think they really wanted to make a loan.
I finally got my So Texas bank to go out of area and make me a 70% loan. Only did it for me, being a very good client. I hope to establish the building and then go refi with a HUD loan. Didn't have enuff time to do the HUD for the first loan. Good luck. Your experience, and building info have to be PERFECT to get a loan, imo. Rich

My group will fund apts in major tx markets and some 2ndary mkts.

20% down would work if there was a "story" / reason for big discount.

we dont want to loan more than 60% ARV, maybe 65 deal is really solid and good area.

we see lots of people looking to pay too much apts these days. Base your value on 10 cap and use at least 3500/door expenses if not more.

Monty
[LINK REMOVED]

email me some details, might be able to get 65-70% and the seller can hold back the rest, you would need to put some money don pending the deal, email me at [EMAIL REMOVED]

Greg Kunard at BMC Capital in Houston is the best lender for apartment complexes I have found. I would list his info here, but it is likely against one of the 100 forum rules that I haven't memorized. You should be able to find him on the net if you would like to chat about strategies.

Originally posted by Tracey Williams

Bryan, do you know if BMC capital work with investors outside TX.

Thanks

Yes...I am sure Greg can write loans in many states. He may have to broker it to some of his colleagues, but I would recommend that you work with him. I have talked to hundreds of brokers and he is fantastic. KC Capital in Austin has a number of great brokers too...you may want to give them a crack at things to keep Greg honest.

Please feel free to use my name if you would like to.

Originally posted by Rich Weese

I have a post on here somewhere about BMC capital in Dallas. They jerked me around 9 months ago and even sent me a loan committment letter and then pulled it. Almost cost me a deal on my 154 units I bought. I'm not a BMC fan. Check the particulars on my post. Rich

That is why I said you need to talk to Greg :mrgreen:

I know this post is old, but just to put my horse in the race, I can/could help with this deal.
I have a small balance commerical program from a national lender.

-Loan amount: up to 500k
-Rates: low 6s for a 3/30 up to mid 7s
for a 15/15
-LTV: 65-75%
-FICO: 700
-DSCR: 1.2
-PPP: 5 year stepdown (3%, 2%, 1%)
-NO COST FOR PROPERTY
VALUATIONS
-Very low lender fees
-Takes about 60 days to close

Bryan, the only non-recourse option I know of is HUD's 223(f) program. Loan amounts range from 1.5-2MM and up. There are a lot of requirements for these loans, and they are not cheap to obtain, but the rates are good and it is a 35 year loan. HUD also allows for cash-out, which is hard to find right now, to 80% LTV, but the property must be 3 years old (from the date the CO was issued), and the borrower must have held the current note for 2 years before HUD will allow a cash-out refi. HUD also requires 90% occupancy for 3 months in order to qualify. There's a lot more to these so if you want more info feel free to email me.

There are other lenders who advertise non-recourse loans, but from what I've seen, the LTVs for those programs can make the loan unattractive for borrowers so I don't even try on a loan where non-recourse is a requirement if it falls outside of HUD's programs.

Like any loan, it really depends on how prepared the borrower is. If everyone is firing on all cylinders, HUD loans can close in 3-4 months which isn't all that bad considering the state of lending right now.
That is of course if the borrower works with a MAP approved lender (or LEAN for medical projects). If the lender isn't MAP approved, then yes, it can add a substantial amount of time to the underwriting process.
All the more reason why a borrower should work with someone who can help them navigate through the lending minefield.
I should note that I'm talking about purchases and refinances. Rehabs/construction can take forever (upwards of 9 months) with HUD, but not many lenders can come close to offering what HUD does for terms so its a trade off. I don't know where else a borrower could obtain 90% construction financing on a 40 year non-recourse loan.