Real Estate Professional · Orlando, FL · Member since 2016 · 22 posts · 10 votes
I have recently saved up 40k and I'm looking for a multifamily property that I can acquire with a 40k down payment. I travel to Norway a lot so I would need a manager in place. I'm also interested in a joint venture to acquire a bigger multifamily property but everything needs to make sense. Need some advise.
Rental Property Investor · Gulf Breeze, FL · Member since 2014 · 1k+ posts · 733 votes
9y
Congrats on the bankroll @Kevin Frett. As Mark was saying it all depends, but most lending institutions want at least 20% down. I've had the most success with small local banks that have 2-4 branches in your area. If you want to JV on a deal in Pensacola, let's talk.
Rental Property Investor · Tucson AZ / Nice FR / Washington DC · Member since 2016 · 1k+ posts · 1k+ votes
9y
Depending the location you can get a duplex or quad. Personally I would go after townhouses, lower turnover, and if you work for it you can get a few townhouses for cheap, otherwise get into a syndicatio. Most syndications want 25k+, so you could get into one or two of them. Even my investors get a 8% premium yield per year. What I'm saying is you have better options.
Investor · Orlando, FL · Member since 2016 · 1k+ posts · 780 votes
9y
In order to buy a small multfamily with only $40k then you probably have to do a deal with owner financing. I work with lenders that will loan 90% if the deal looks good.
Commercial Loan Officer · Southern Maine, ME · Member since 2009 · 782 posts · 415 votes
9y
For commercial loans, a lender is going to want you to put down 20-25% with it being more likely to be 25% than not. They also want to see post closing reserves ranging from 6-12 months of PI.
It's important to note that banks look at your global debt service ratio as well as the DSCR of the property. Meaning, they want to see that you have the income and reserves to sufficiently pay all of your debt comfortably (banks have their own internal ratios they use) AND be able to keep the property aloft should it need your help. Your personal guarantee only means something to a lender if you have the financial muscle to back it up.
Real Estate Professional · Orlando, FL · Member since 2016 · 22 posts · 10 votes
9y
Thanks for all the information. I haven't spoken to a lender as yet. I was looking for more deals with owner financing, because they seem to come with better terms. I'm not looking to buy directly in Orlando because the price tags for properties here I feel are overpriced.