Under contract, need a lender

[Anthony Torri]

Hello,

I am currently under contract to purchase a 4-plex in CT (3 residential units and 1 store front). The property also has a large parking lot across the street from a big employer and generates income from it. 

I haven’t been able to find a lender because after doing a title search it seems that the property is grandfathered in to legally have those residential units since it’s zoned commercial. Lenders have fear that if the property were to ever burn down or get destroyed that the zoning would not allow it to be rebuilt as it currently is. 

Anyone know if a lender who can make a 20% down DSCR loan work on this or have any advice?

[Brad S.]

You can do some preliminary homework yourself by contacting the local zoning office (whoever governs zoning in the Subject area) and ask them what the policy is on rebuilding a damaged nonconforming structure. Many times they have their municipal code online and you are able to find the info there. In my experience, many areas will allow the structures to be rebuilt with the same use, if less than 50% is destroyed. But, maybe your area is more beneficial and you can educate any lenders then.