How much EMD should a Syndication put down?

[Joe Miles]

Hello everyone!

I have a few questions.

1. How much emd should a syndication put on a deal when there’s a lender involved?

2. How much time is between the signing of PSA and closing? (Asking to see how much time one really have to raise capital)

3. Do the commercial lender consider the EMD as apart of your down payment? (Never dealt with a lender, always paid cash on my residential flips)

4. Can you explain the process from finding a deal, psa, due diligence, and closing..

Thanks!

[Brian Burke]

Typically around 1% of the purchase price within 3 days of signing PSA.  The percentage might be higher on smaller deals, say under $10 million maybe it’s a bit over 1%. Then you’ll also need a lender deposit for third party reports and sometimes an app fee. These can be $50K or so, depending on the size of the loan.