Financing an apartment complex

[Connor McGinnis]

I am looking to invest in the Metairie, LA market. It is a suburb just outside of New Orleans.

Can someone provide some insight on how you structure your commercials loans? My parents who invest, say they never do deals with more than 15 year amortization. They are in a different market (northern Illinois).

I have been struggling to find properties in this market that provide much cash flow at a 15 year amortization with 7-8% interest rates.

I had one deal fall through for 36 units. It was an 8.11% cap rate with current rents with upside to raise rents by 20% with renovations done to the property.

Some other investors recommend doing a 20-25 year amortization period on the loan which helps cash flow a ton. However, it takes a long time to pay off this property and forces me to accumulate much more interest over time.

Looking for some advice on how to structure commercial loans when analyzing apartments. My parents have the cash to help me with a down payment which I would then pay them 5-6% interest on.

Any advice would be appreciated.