Residential Vs. Commercial
There are many multi-units available in St. Louis. The brick buildings are up to 80 years. My criteria includes updated windows and kitchens; new roof; and updated plumbing and electric panels. Thanks to many re-hab investors, there are quite a few opportunities. So why not go bigger? Rather than a gutted, rehabbed duplex or 4-plex, the gutted and rehabbed 6 unit building is very attractive. All three fit my criteria. All three pass my 1% rule. But the 6 unit building falls into the commercial loan department. Why does the commercial loan get a bad wrap? Bank #1 and #2 have similar basic terms, 20% down, 3 years fixed at 5%, with an adjustment at the 3 year mark to 'current market interest rate.' I haven't rcvd. a reply yet, as to how they define 'current market'. But on paper, there is a agreeable cash flow, double the duplex. Why isn't there a long line of interested buyers?
Kathy H., Newbie