Apartment building 10 year loan - standard?

[Matt Dabek]

So I went to my bank yesterday and they said that they can qualify me for apartment building loan.

My problem is they said that the longest term of such loan would be 10 years/20% down. Now when run my numbers with that on any property 1M+ the monthly NOI covers only about 50% of my mortgage payment. I would have to stretch my loan to 20-30 years in order to have some monthly cash flow.

Is 10 years really a standard length of commercial loan?

Are there properties that would generate income that would actually covered mortgage payment with 10 year loan?

What am I missing here?

[Joshua Davies]

@Matt Dabek Hi Matt, commerical loan terms can be confusing if you have never heard of them. 

The loan term maybe 5, 7, 10, 12 years, however the loan will be amortized over 20, 25, 30 years. This means that the loan payments will be based off a 20,25,30 year repayment schedule, however you will need to implement your exit strategy after the 5, 7, 10, 12 year term (whether that may be refinancing or selling the property) or the loan will be due.

Please feel free to reach out if you need more explanation on commercial loan terms.