At this stage, the most effective move is to engage a zoning expediter or architect who routinely shepherds Center City projects through L&I, the Planning Commission, and ZBA.

I’ve owned and underwritten a few deals like this, and the short answer is: what matters isn’t how you think of it, it’s how the city, lender, and insurer classify it.A detached garage converted into a store pushes this firmly into true mixed-use, not residential with an accessory structure, unless it’s fully permitted and zoned that way.A few things to verify before you get excited about the numbers:• Zoning and permits – Is the commercial use legal, non-conforming, or outright illegal?

Got to wichita went to the neighborhood expecting to see a war zone.

Other times it’s paperwork.What’s a red flag that instantly makes you dig deeper?

Agree with the concerns from @Jeremy Horton and @Jo Bradley In addition to tenant wrangling there may be difficulties with zoning, occupancy and resale.

We did the background check using rentprep and no red flags except there is no credit history.What are the risk? 

But before you go too far, you need to answer one question first:Is the zoning aligned with what the surrounding commercial/apartment developers are doing?

•Any red flags that kill deals immediatelyNot looking to debate theory — just trying to understand how real buyers are underwriting in this market today.Mainly curious about Multi Family metrics(2-4 units).

It’s in a commercial zone that does allow six residential units, and it’s currently used as long-term rentals.Key points:6-unit, all long-term rentalsCommercial zoning that permits 6-unit residential use:  6-unit multifamily in a commercial zoneFirst-time investor, strong credit, solid down paymentTarget: 75–80% LTV, 30-year amortization, likely in an LLCHas anyone here closed a similar 5+ unit DSCR deal with Easy Street Capital or RCN Capital?

How are other landlords approaching this red tape?