Residential mortgage for mixed use property

14 Replies

Hey everyone, is it possible to get a standard residential 30 year mortgage with 25% down on a non owner occupied mixed use property??? I am trying to put an offer in on a property right now but I am being told by multiple lenders that I can not. HELP!! Thanks everyone

Nick

What is the mix?  Like retail on 1st floor, residential upstairs?   If so I would think you will have to use commercial.  Go to credit union or local banks or commercial lender for financing.  Total guess, but if it is something like I describe I think probably standard is going to be 30down/70% financed and they may want some % of reserves held in their institution for surprises.   They all might be a little different.

@Bruce Lynn

Yes bruce it has two apartments and a small office/store front downstairs. Do you think that 30% down flexible? I want to do 25% Im hoping i can find a bank that will work with me. Thanks for the response

@NIcholas Hamel    You just never know the options or motivations of different lenders.  I'd plan on 30% down.  Maybe you could get owner carry some % of the 30%.   Might depend if it is occupied or not, might depend on how much reserves you keep on hand at the lender institution, how many other deals you've done with them, your reputation and history with them.  Might depend who the tenants are and how long they've been there. If you are new, then they want less risk, experienced with a history, then they might be more flexible.   Probably no standard answer and lots of exceptions, but the standard answer today is probably 30% down and some reserves.

@Bruce Lynn

Yes exactly. The apartments upstairs and a small store front. I actually found a lender who had an interested private investor who would allow me to put 20% down instead of 30% which helped out a lot Although the original lender wanted 2.5 points as a finders fee for connecting me with the private investor. Does that sound standard to you? Thanks Bruce.

Nick

With apartments upstairs and retail downstairs, you should absolutely be able to get a standard mortgage on that with 25% down. If you're hearing no from lenders, then a portfolio lender who isn't going to flip your loan is going to be your best bet.

Question though: is this going to be a jumbo loan?

If so, that might be the issue. You might need to go 30-35% down to get that to happen then

Originally posted by @NIcholas Hamel :

@Sean O'Dowd

I was hoping to just get a regular residential mortgage. Not a jumbo.

Oh, sorry if I wasn't clear! Whether or not a loan is a jumbo is not up to you. It's based on the government-set level for your area.

In most cases, if you loan is >$500K, it's a jumbo loan whether you like it or not. 

Once it becomes jumbo, your lender is going be way more restrictive. Once it's jumbo, you're going to need significantly more down

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