Commercial Loan or Conventional Loan

[Daniel Rehner]

I am a new RE investor getting ready to buy my first deal.  I plan on using money from equity in my house currently at 4.5%.  I have talked with a couple different banks around the Lexington, KY area and have a few different options. I know that If I go with the conventional loan and can make a lot more deals cash flow.  However, all of the conventional loans require 20-25% down which will eat up a lot of my capital.  One of the bank in this area is offering a commercial loan with just 10% down 20 year amortization; rate: 4.5% and it balloons in tens years.
This takes up less of my capital but does make it a bit harder to cash-flow, and I do have the additinal sooner deadline of 10 years to either sell, refinance ( at possibly higher rates) or pay it off ( not likely). 
Would you all recommend going conventional even though it requires more money down, or commercial because it allows be to get start easier and possibly get a 2nd property sooner?

My strategy is going to be buy/hold, and would love to get a BRRR property.

Any advice is welcome.  Thanks

[James Syed]

Welcome to BP. 

10% down, 20 years amortization, 4.5%, 10 year balloon is an excellent loan. It's very hard to get more than 5 year balloon. 

Good luck!