All Forum Posts by: Jacob Stahl

@Blaise P.

Hey, thanks for the insight!

@Henry Clark

My mention of using an ARM in a previous post was for a different property. We did end up purchasing a single family rental using a 10 year ARM, 30 year amortization rate last year.

The property we are looking at now is a 5 unit flex space/storage building with 1500 sq ft each unit. Working through it with our lender, the commercial loan would be a 5 year balloon product at 4.9%, amortization rate of 20-25 years.

Again, we have the cash for the DP, but also thought about using some of the equity in our primary residence (not paid off) for part of the down payment as to keep a healthy cash reserve. Possibility 50% cash and 50% from the home equity, still trying to decide.

Thanks

@Joe Villeneuve

Thanks! I agree, it would definitely depend on deal specifics. I was just trying to get broad idea of anyone on here has ever done a deal with this method. I guess a better question would have been has anyone ever used their home equity (fastener) for a down payment in a deal? And if so how did this result in the return of the deal?

@Mike Dymski

Thanks for the reply! This strategy is one we (me and my wife) have discussed as an option. I guess I just wanted to chime in on BP to see if we had similar thought processes of other more experienced investors.

@Joe Villeneuve

Could you better explain your analogy and how my question is similar?

What would be a better option for the 20% down payment on a commercial property - using all cash or taking out a home equity loan or partial of each?

Using all cash would hurt my reserves, but would be able to cash flow better on the deal. Using a home equity loan would obviously save my cash reserves, but limit my cash flow to pay both the commercial loan and the home equity loan back.

Hello All,

I am looking at a commercial property and would like some advice on financing the deal, specifically the down payment.

I will be securing a commercial loan through conventional financing, 20% down with 5 year balloon and 20 year amortization rate.

I do have the cash for the 20%, but that would exhaust the vast majority of my reserves. My debate is should I use a home equity loan or a HELOC for part of the down payment OR use all cash for down payment and use HELOC for any personal expenses as needed after that?

Thanks in advanced!

Thanks for the helpful tips, however me and my wife already have a primary residence in a house we built 4 years ago.

Hi all, I posted this in another forum, but wanted to drop it here as well.

I am looking to buy my first rental (4 unit apartment building) and wanted to get some feedback on some loan options I have.

Here are my options I am considering:

1. A 30 year fixed rate mortgage at 3.5% with a 25% down payment.

Or

2. Options of 5, 7, or 10 year ARMs at 3.25%, 3.625%, and 3.75% respectively with a 2% adjustment and 10% down payment.

I have ran the numbers and either option would have a decent cash flow. I have the cash for the 25% down, but would only leave me with about $5-7k left over which isn’t ideal incase of emergencies. Ideally this would be a buy and hold investment.

Any advice would be greatly appreciated!

Hello all,

I am looking at buying my first rental (four unit apartment building) and wanted to get some feedback on some loan options I have. 
Here are my options I am considering:

1. A 30 year fixed rate mortgage at 3.5% with a 25% down payment. 
or
2. Options of 5, 7, or 10 ARMs at 3.25%, 3.625%, and 3.75% respectively with a 2% adjustment and a 10% down payment. 

I have ran the numbers and any option would have good cash flow. I have the cash for the 25% down, but it wouldn’t leave me with a lot leftover ($5-7k) which isn’t ideal incase of emergencies. Ideally I would buy and hold this property. 

Any advice would be greatly appreciated, thanks!