Multi-Family financing and management for

[Mandela Shaw]

Would you mind dropping links to any good threads that can help a beginner looking to invest in 5-12 units properties? Specifically, looking to understand the in and outs of:

-financing options (e.g., types of lenders, down payments, “creative” ideas, loan criteria, loan requirements, etc….goal for me would be to put 10% or less down if possible)

-advice on inspections and repairs required at time of purchase.  (What impacts will these have on the different types of lenders?)

-advice on property management (fees, responsibilities, tenant screening, tenant placement, etc.)

-maintenance (how do you manage expectations and costs from repair men? I have 3 SFH rentals and I personally inspect any repair requests before contacting someone to fix. I do not have a property manager and I have not had to do this often. But this will obviously be a huge expense in a property this large.)

-utilities (I have seen some things about having utilities reserves. What are these? What utilities do you pay if any vs. what the tenant pays.)

[Mordy Chaimovitz]

Here are some pointers in the CRE financing world.

1. You need to have a networth equal to the loan amount

2. You need to have liquid assets equal to 10% of the loan amount after you paid your downpayment and closing costs. 

3 it is easier to get better rates and terms in a large market such as a big city as opposed to a small town. 

4. On average you will need to have a dscr os 1.25

5 On average you will need to put down 25%

6. If you dont fit these criteria you can sometimes get a hard money loan with very high interest rates

7. If you plan on refinancing out of a hard money loan in the first 2 years after acquisition,  you will only get up to 80% of your total costs, NOT 80% of the value (and its usually only up to 75% of costs)

8. Lenders look at your experience on the asset class when determining your eligibility for the loan. 

there is a lot to learn in this area. Feel free to dm me for more details over the phone.