4+ unit properties

[Manan Shah]

Hello,

I am looking at 2 properties, one 2 unit property that I have put in an offer of about 120k that can generate positive cashflow of $600 per month and another which is a 6 unit property where I have put in an offer of 350k that can generate $2000 cashflow.

I have a bank ready to lend a mortgage at 7% for the 2 unit property. However, the bank indicated they cannot finance the 6-unit property and I would need a commercial loan for it.

Can you please let me know how commercial property mortgages differ for a residential property mortgages and if there would be a substantial difference in rates? Based on the information, would it make sense to move forward with the 2 unit property or a 6 unit one? It seems that the 2 unit generates only $600 monthly cashflow. However, I could add more smaller properties to build the cashflow.

Any guidance would be great.

Thank you.