Lender underwriting for mom n pops
In the case of smaller properties that have lax or no financials, what approach to lenders take to underwriting/valuation? Are some types of lenders better for these than others? My gut feeling is that community banks and credit unions might be the ticket for this type of thing.
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Some local institutions who carry their own paper should be able to base the income of a property of a reasonable proforma based on current or appraised rents. I was able to funds all 3 of my MF properties(20% down, prime -0.50, DSCR 1.25, 7 year balloon on a 25am) off of pro forma financials.
I would assume that you are going to have to go into multiple local banks to find one you connect with, but you should be able to find one. Secondary markets are on very unstable footing, so it is much harder to get money now, but banks still have to lend to make money, and really do need to dilute the low yield paper they currently are sitting on.