Financing commercial mixed-use property with laundromat

[Tije Wilkins]

Hello, all! I came across the opportunity to buy a mixed-use commercial property but I wasn’t prepared and not sure how to navigate the commercial process since the owner isn’t willing to seller finance, and I just recently bought a primary home in November so I can’t get any type of owner occupied loan. I just wanted advice and resources from the fellow BP community!

The property has a laundromat ($24K/yr), mechanic shop ($7200/yr), and 2 mobile homes (owned by the tenants) on a month to month lease ($400/mo). And room for another mobile home (I’d prefer putting my own mobile home to live in on there). The purchase price is listed at $285K and that includes ownership of the land, laundromat, and shop. I only have access to about $30K so not enough for a 20% down payment. Even if I negotiate the price down I don’t have access to $50K+ just for the down payment. The laundromat is an old mom & pop, and will likely need new machines (currently 6 washers & 4 dryers). I don’t have detailed financials on the laundromat as they just did the bare minimum to keep it open, and I want to go in and add value. This is the only laundromat in the town, with the next closest one being 45mins away. 

Note: I bought my primary home in Georgia because the home next to my mom's that I grew up in went for sale, so I plan to hold onto it longterm and put it in a trust with my mom's house. I bought it as a primary residence but it's sitting empty majority of the time as I work in New Mexico 95% of the time and get per diem to be here which more than covers my New Mexico living expenses. So if there's any way to swing this into a reason why I need a second primary home in New Mexico, I'd be interested in that. My DTI is roughly 30% and I make a good 6 figures with my 9-5 plus day trading money so I know that I'll be able to manage both mortgages, I just don't know how or if I can go about financing this deal with little cash on hand.

Any help or resources to look towards would be appreciated, thank you!

[Charles Carillo]

@Tije Wilkins

Have you actually spoken to any local lenders about the property? 

I would suggest speaking to local banks and credit unions. Whenever I have an issue with financing, I normally contact local institutions. They are much more reasonable and are more intertwined in a community than some lender states away. The credit committee is usually made up of local people who are familiar with the market they are in. Lastly, they like building relationships. Once you find a lender that finances properties similar to yours, start building a relationship.