Am I to young for a commercial loan?

5 Replies

So here's my deal. I'm almost 20. I've been doing construction full time for about 6 years now. (I went to a private school, skipped high school cause the curriculum we had the 8th grade was equivalent to public school's 12th grade, got my GED at 16.) 

I'm starting to dabble in real estate. Flipped my first small property this summer. My background in construction seems to come in handy for flipping. Thing is, I like real estate a lot more than my job. So I've been trying to learn everything I can by reading, reading and then for a change of pace reading some more. 

It has been said multi-unit apartments/condos are where the money is. The trouble is I'll have to get a loan to get started. Say for example, there's a 46 unit condo complex, 95% occupied, with an 8.10% cap rate available at 3 million dollars. Considering I would want as small a down-payment as possible, my question is this: Will a commercial loan officer take a second look at me if I'm in my very low 20s? I understand commercial loans are dependent more on NOI etc than residential loans, but I'm a little worried that a loan officer would make a decision based largely on my age. What do you think?

Also any other constructive advice would be appreciated, thanks.

If you're old enough to be a licensed contractor you're surely old enough for a loan, commercial HM or PM. There really isn't an age limit to have a bank account if you think about it. You have to be at least 18yoa to get rid of your parents from minding your monetary business. Have at it. 



"I am an old man and have known a great many troubles, but most of them never happened."    Mark Twain

I appreciate your post.   Age has never been a criteria I have ever seen.  True the lender wants to know your able to execute your business plan. 

I am an advocate of Joint Ventures to cure any deficiency

5 Lenders tell you no keep asking

30 lenders tell you no...really ponder what your trying to do.


I too am new to CRE. I am actually waiting for a response on my first offer. Please be aware of the sizable capital needed on a 3 million dollar loan (not sure if you used that as an example). The best thing about a property that you described is the occupancy rate. It will make your proposal for financing very strong.

Good Luck!

"95% occupied"

This doesn't mean anything.

Instead: 95% occupied for 24 months at least and the books show almost all tenants pay on time with low turnover.

That's a lot better.

The age thing would likely come down to lack of track record and capital. It's not just about buying the property but having the reserves to maintain and keep it performing throughout the loan obligation period. Banks and other lenders are assessing rick level for default.

If you have a great deal then you could either try to assign it for a fee or JV with someone stronger who would qualify for the loan etc. It's different if you want to learn how operate a MF asset versus just doing transactions to build capital.

Younger people I have seen get loans but they have some edge. They lack experience but are worth a lot of money etc.

If you have limited to no track record, almost no funds for that deal size, marginal credit, and marginal income there is not a reason for a lender to get excited about it. 

Thanks all of you for taking the time to offer advice/opinions/encouragements. 

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