Hello everyone! I am exploring starting an LLC with a trusted colleague of mine. We have an amazing market to be in (Boston). We are looking to invest in a commercial residential multi (around 12 units). My ? is how much does my and his personal credit come into play for the financing? Being commercial the properties we are looking at more than finance themselves, we are adept at management as we both own separate companies in construction and past real estate investments. Also same concern with a residential 4 unit (non commercial)

A banker told me the other day that if the LLC is 2 or fewer years old, your personal credit will be very important.

Be sure to check I with your lawyer and CPA. Good luck.

No doubt. My question is if the individual credit gets used or how that gets used. Tia!

@Ted Shackleford - your best bet is to call a number of local commercial lenders and find out.  you will get better answers than just posting on the site here.

most lenders will look for your credit to not show any major blemishes but they are also going to want to know that you have the experience and know-how to manage a property.

so what is you and your potential partner's experience?  if you have a specific property in mind, do you know how much it will cash flow?

when evaluating properties, any lender will want to see that you have a plan to increase value in the property (raising rents, fixing units as turnover occurs, etc) or that it will cash flow from day 1.  they will also require a 25% down payment most likely.  this is my limited experience from contacting some commercial lenders just to understand their process.  i do not have any commercial property experience, but do have a few multi-families - those loans were traditional, not commercial.

i do have experience with getting commercial loans for residential construction projects.