Large Commercial Mortgage with No Seller Capital Required in Main

[Sarah Msuya]

Hello everyone, 

I have a large portfolio deal that I working through. The lender I am using for another property said its required to have 10% of seller funds in the deal. I would love to have less than that and use more of a seller carry. I have called a few local banks, gotten one that said they require 20% and waiting for call backs on the rest of them. Is there another way I should go about this? I've heard on podcasts of people getting into large deals like this using 80% bank money and 20% seller carry. 

The portfolio is in Lewiston Maine - TIA!

[Lucas Miles]

@Sarah Msuya "Lender said its required to have 10% of seller funds in the deal" - Not following this. Lenders will loan 80% (or 75%) of the purchase price (assuming appraisal comes back higher than purchase price). So you will have to bring the remaining 20% in "cash" to the closing table. This 20% could come from your money, bringing in a partner, a hard money lender, or even the seller (seller carry). Easy numbers, your buying a property for 100k, bank gives you 80k, seller holds a 20k seller carry, your into the property for "no money" (other than some small closing/title fees). So instead of seller walking away with 100k at closing, seller will only get a check for 80k. So now you will have a monthly mortgage payment to 1. The bank for the 80k and 2. The seller for the 20k. Typically a seller carry will only be for a few years, and often interest only payments. By doing this your assuming you will be able to come up with the remaining 20k to pay off the seller in a few year, or the property will be worth more and you will be able to refinance and pay off the seller the 20k. 

[Ronald Rohde]

what does the full capital stack look like? Asset type? Occupancy?

[Bethany Turon]

There are some lenders in the area that will allow owner finance of the down payment portion.  Please feel free to connect and I will get you some contact info.