Updated over 6 years ago on . Most recent reply
Adding units to a triplex
I stumbled across a triplex in my local market that has plenty of room to add additional units. There's a nearby property that is the same size and zoning and they have 6 units on the property versus the 3 units on the subject property.
My question is a financing one:
What would be the best way to finance this deal? My initial thought was to purchase the 3 units with residential financing (3% down), get a construction loan to build the additional units and then refinance the 6 units into a commercial loan. Does this sound like a solid plan? Also, I know there are rehab loans where I can finance both the acquisition and construction but would I be able to use this type of loan to add the other 3 units? I know a decent amount about residential financing but not so much on the commercial side and I'm always open to insight from other investors.
The property is located in Arizona, if that makes a difference for loan products, etc.