Updated almost 10 years ago on . Most recent reply
when purchasing 5 units or more
What all is looked at the most when trying to buy a multi unit complex? am I looked at less or the complex more or vise versa? I am trying to get an understanding of this as I am looking to buy 1st investment property .
Most Popular Reply
@Brian Coble, on a 5 unit or larger, the lending agency will focus on the Net Operating Income (excluding any financing obligations) vs the cost of the asset to make most determinations. However, if this is your first time, they will most likely not approve unless outside property management are part of the deal. Additionally, they will likely ask for 30% down payment. For better chances at approval, have a detailed management plan documented to include who is managing, how you will keep costs the same or lower, what cash reserves are to be kept, and what are your potential exit strategies.