Borrow More than Cost of Apartment?

[Bill Smith]

I will soon buy my first building, a 14 unit apartment.  US Bank has offered to loan me $300,000 more than my cost of the building.  The $300,000 is for capital expenditures.  Problem is, I don't know if I need that much for capital expenditures.  Should I still accept the loan with the extra $300,000?

[Charles Carillo]

@Bill Smith

I would consider accepting the funds and placing the additional funds in a savings account or money market. If you go over budget (very common); you can pull funds from this account without going back to the bank. After the project is complete and rented; you can send the funds back to the bank. The thing with borrowing money is when you really need it; it is difficult to get.