My business partner and I are considering investing in a MFH. This is our first purchase as a partnership and neither of us own our own homes. As a result, our credit scores are good (we both have an excellent history of paying our bills on time) but not great (due to a lack of installment accounts and insufficient mortgage information.) Both of us have good income streams from our jobs, but cannot afford to buy homes near our jobs in San Francisco.
If we purchase a MFH as a partnership, will banks require more than 20% down due to our lack of home-buying experience? And if we do buy the property, will our individual credit scores benefit from the on-time mortgage payments on the property?
I looked for the answer to this question in the forums, but could not find one that fully answered it. If anyone has a link to such a forum post, please comment with the link. Thanks in advance!
Biting off a multi family as your first can certainly be done, depends on how big and the cure for your inexperience is having a PM at least early on in the ownership, that can put you in as a passive investor too.
If you take on debt personally it will be on your personal report. If you guarantee a company debt you can ask that they report it, they will anyway, but the distinction is who makes the payment as to payment history. Two issues with credit reports, debt reported and payment history.
Ask your lender how they will report. Good luck :)
Bill Gulley, General Real Estate Academy | https://generalrealestateacademy.com
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