Question on First Commercial Loan

[Mark Larson]

Hello, I have seen some conflicting answers on here and was hoping someone could help clarify things. For a first time commercial loan on a multifamily property, are the loans non-recourse and are they tied to my income/assets for a first time multifamily property?

I had been looking for duplexes around me but came across a 16 unit building off market that it looks like I will be able to get the owner to agree to 800k (8.5% cap).

Long story short, I don't have employment that could justify a property of that value but I do have 150k to put in as well as a credit shelter trust that can cover the remaining equity needed (I'm the beneficiary so they're not technically my assets). I will ask my bank that handles the CST if they will take it but in case they're not interested, is a loan like this possible to get for someone in my shoes? I was hoping to get 60-65% LTV, 10 year, 30 amortization.

[Brian Garrett]

For a loan that size you're going to be looking at a recourse loan with a commercial/portfolio lender.

The non-recourse agency debt is for loans greater than $1MM.

60-65% LTV won't be a problem but you'll likely be looking at 20-25 year amortization rather than 30.

I have seen some lenders who offer 30 year AM on commercial products but they are less common.