Financing Apartment Building w/ Equity

[Joseph Duenas]

I've been investing in single family homes for about ten years now, and I want to make the jump into multifamily apartment buildings. My current issue is that while I have about $900K in equity in my single family homes (many are paid off), but  I currently do not  have much cash on hand.  

Question: If I had $800K in equity on free and clear property, could I use this equity instead of down payment to purchase a $1.9M  apartment building (provided that the building's numbers work?  Or would I still need money out of pocket?  What kind of interest rate and term could I generally expect using equity instead of cash?  

Thank you! 

[Brent Coombs]

@Joseph Duenas, an Asset-based (Portfolio) Lender may well let you Refi your current Inventory, and you could either ask them to add their "payout" figure to the amount you'd also need to borrow as the balance for the $1.9M apartment building, OR, you could ask for the payout figure in cash, to take to any other Lender who might have better one-off loan terms for JUST the apartment building.

Firstly, they'd also check what your subsequent cash flow from refinancing your portfolio would be, to make sure you'd STILL be an acceptable risk. Interest Rates and Terms can depend on how good YOU are as a negotiator. Good luck...