Refinancing Multifamily Land Contracts Into Perm Financing

[Charlie Claxton]

Hey BP family,

I wanted to know if any of you guys have done this, and if so- what has been your experience? We have done it repeatedly, but we have only met a handful of investors that do it our way.

* Buy a VALUE-ADD multifamily asset (40 units +), using cash (private capital) or control the site using short term land contract. These assets normally are in need of a capital improvement campaign and/or a serious management turnaround.

*Using investor capital, we will capX the site, and stabilize the site with new management and using connections with various charities to get the property to 85%-90% occupancy.

*Once asset has been at stabilized occupancy for 6 months, we will either refinance or resale the development via online auction. - which earns our investors a 12%-20% return on their investment.

Here is the question for the BP family, - Has anyone in the BP family successfully refinanced a multifamily land contract into a new commercial loan, if so- where did you get the best terms, time frame, out of pocket, requirements, etc.. We are looking for a new perm refi- financing home for our multi deals. Most of our deals are here in the Southeast.

Thanks everyone!

[Charlie Claxton]

Hi Guys- sorry for slow reply. My schedule has been nutts lately.

to answer james question- yes we have used HUD before (HUD 223F), but the average property that we do will have a hard time on the PCNA report for the HUD loan, as these are much older assets and we are usually focused on stabilizing & filling them. We typically focus on making sure major systems are up, and then begin unit upgrades on a rolling basis.

And thanks for the suggestion guys- I have emailed Sean. I look forward to having the conversation with him.