Buying Commercial property as my first deal

[Shakeel Amir]

Hi,

I have been a passive member of biggerpockets for a while. I already own a home and i have learned a lot about residential properties from books and cds.

I have just seen a 15+ unit building listed for sale in my area. i know the building very well and i want to make an offer. The owner is very motivated and he states that he is willing to finance 70% of it. I have a feeling that he can finance even more than that.

I have great credit but i know the commercial property would have very little to do with my own credit.

So how do i go about finding out if i can get a commercial loan for this property. If the owner is willing to finance 80% of the deal, do i have to pay any cash from out of pocket or would a bank give me a loan?

Is there any company or quick mentor that can help me navigate this deal. I am a CPA and work in finance industry so i can crunch all the numbers, i would need some direction.

[Account Closed]

You may want to check out the commercial property forum because there are a number of contributors there that have talked about these kinds of issues.

You may run into some trouble getting a conventional loan because you don't have any past experience with this type of property. You may be able to cure this situation by finding partners that have experience with multi-family commercial properties.

Another issue that comes to mind is leverage. Leverage is a good thing, but to much leverage usually means negative cash flow or at best very little cash flow. Private lenders and conventional lenders are going to want to see some of your skin in the game.