Best way to fund a small RV park that needs a septic replacement?

Question

Looking at a small RV park, under 10 sites, low six figure price. The septic system needs to be replaced and the seller is willing to sell as-is. \

How would you structure the funding?

1. Seller financing for the property, then a separate loan for the septic?

2. A commercial bank or credit union loan?

3. Bridge or hard money, then refinance later?

Also, will lenders even look at a park with an open repair issue, or do they want it fixed first?

First RV park for me. Any experience welcome.

Matthew Morrow · Answer

@Louis Jara We had nearly the same thing here in PA, except it was two failed systems. It ran into a municipal wall and essentially required a full replacement of both. The only fix was an investor willing to take on a huge burden for a few months to tackle the project. Many lenders won't touch it, but private money or a JV where the lender gets ownership after the reno is worth exploring. I'd lock in a real septic bid before you finalize the capital stack. What's the as-is vs. repaired value looking like?

Best way to fund a small RV park that needs a septic replacement?

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