Best way to fund a 6-unit property?

[Monica Johnson]

I'm currently looking at a 6-unit property for $68000 in the Indianapolis area. I have the money for a 20% down payment but my debt to income ratio is high Bc of student loans (even tho I'm on a $0 repayment plan, they still must be included). I'm thinking my best bet would be to find a lender who will let me use the rented units as income. Does anyone know of a good place to start? Or would a hard money loan be an option? No thanks as a flip but I know there are some hard money lenders that will let you hold a property. Thanks!

[Grant Anderson]

Is that $68,000 per unit or purchase price of $68,000? In my experience it is difficult to get a lender to loan less than about $70,000. It is not worth their time because the fees are too low. Therefore you would have to buy a property that is worth about $93,000 with 25% down. 

Since you are looking at the more than 4 units you will have to go with a commercial loan and they will typically look at the income the property will be receiving. Typically they want to see over about a 1.25 debt coverage ratio.