Want to pull trigger on 12 plex....what am I going to need?

[Brock Y.]

I am a novice with the commercial lending side of things but saying I have:

1. 25% down payment

2. Credit (From what I read this is not as important)

3. History of being a landlord

What am I going to need extra? Money left in the bank for first 6 months, assets as collateral, etc. etc. I have read and read and cannot find a template as to what the expectations are going to be walking into the lender. I hate to be wasting my time and sitting on money if a commerical loan is unobtainable. Thanks in advance. 

[Paul Stern]

I'm closing on a 12-plex on the 27th. I started with an up to date personal financial statement. I also analyzed the deal to show things like cash flow, debt service coverage ratio, etc. some things the bank is likely to look for is a minimum DCR which will vary by bank. They will want you to carry a reserve fund at their bank. I agree that talking to the banker is the best way to figure out the requirements. They should even give you some guidance on the analysis since they have folks double checking your numbers. Do you have a property picked out? Run it through the BP calculator

And you should talk to the guy or gal in their commercial lending department. Maybe they only have one person. I worked with 4 local banks to find the best deal. And don't underestimate the value of credit and outside income for small multifamilly especially if you are just building a relationship with them