Does 100% financing exist for commercial properties?

Question

I seen online some asset lending banks state they can do a 100% lending on commercial properties. From doing my research it seems that they loan 50-60% and ask the seller to do a wraparound note for a 2nd position. Is this how they work? Does anyone have any good funding sources ? Looking to invest in some multi-fam properties in OK and Tx that I found. Any help will be greatly appreciated

Levi T. · Answer

Yes, as well as SFH.

Maybe others know if you can house hack a duplex or quad using a 30 year fix resident loan, but end of the day commercial is where everyone ends up once they exhaust residential loan options.

Kareem Lewis · Answer

@Levi T.

Thank you for the Info.

Is this the same for small apts..2/3/4-8 plex?

Levi T. · Answer

@Kareem Lewis

The problem with commercial loans is there is no market for the notes on the backend for the bank to unload to someone else.. thus you see arms on loans, it gives them an exit or adjustment point.

Most local banks will do 20 year loan with 5 year arm. You would then need to ReFi in about 12 months to get your money back.

If you don’t have the downpayment cash, you get Limited Partners. As long as the LP don’t own more than 10-20% (each bank has their own rules), you would be the only guarantor.

If you choose the LP route, it’s best you learn about syndicating and SEC rules to avoid any legal problems.

Good luck!