Quote from @Nikolas Engel:
Since this is commercial MFH you would need to put 25% down. That is $143,750. If you do LTV 75% for 5.5% on 25 year term your cash flow - before the PI payment to the investors - is $518/month. You do the math but I doubt that there is sufficient cash flow left after the PI payments for both loans to make this work. But maybe there is a value-add opportunity to increase the NOI, e.g. bring rents to market level, billing back utilities, charge for parking/storage/laundry etc. On the other hand, you have zero $ in the game, each dollar cash flow is pure profit - that is excellent but needs to be in relation to the risk.
Those are my two cents, anybody else?
Thank you this was the closest answer I was looking for. Currently laundry is leased out with coin operated machines, and the current PM company is in the process of transferring all utilities except trash back to all tenants with rents sitting between 495-550 with the lower ends being raised over time.
The angel investor is looking at 75%LTV,
but I’m hoping I could broker the deal to bring the price down to compensate and still take advantage of the no money down.
Again this is my first attempt at something this big. I currently own a duplex inherited long term tenants both older not much of a hassle this is definitely a different animal.
thank you for your insight!
Im going to keep reading and keep learning
