All Forum Posts by: Scott W.

For retail about 90% of lenders will not go above 75% ltv. If they do you will not like the interest rate quoted and the reduction in cash on cash return because of the interest rate spread to cap rate.

You didn't mention cap rate and occupancy ( stabilized or value add). Where is the money coming from? One person, a group of people in a partnership, 1031 money, a syndicate etc.

I have access to properties there.

Hi Scott,

You may want to look at a development map of the area for current and future developments to give you an idea of what the area will be like in the future. I know that helped me to get an idea of the areas. 

I used this site: http://devmap.io/cities

Good luck!

Hi Scott,

First it's all about expectations.

For retail are you talking strip centers or STNL? Are you talking mom and pop tenants or regional to national? Are you talking about urban core, suburban, or rural areas?

Different quality level between a 3 million asset and a 400,000 asset.

Are you paying all cash? Getting a loan? What LTV?

@Scott W.

This isn't mine, but found a nice example online the other day when I was looking for something similar. Looks pretty comprehensive, so thought you might find some value in it.

https://www.biggerpockets.com/files/1203/download

Hope it helps!

i think you have a shot.  I broker loans and I'm a direct lender.  When I'm brokering my thought is you wont know unless you ask and i'd recommend you take the same approach.  

it has to be a strong deal and ideally you're experienced in this property type but yes some of the banks are getting very aggressive.  I think last time i worked a deal like this maybe 2-3 out of 10 banks were not opposed to the idea.  

Scott W. It's certainly possibly. I've quoted deals where the borrower only comes in with 5% equity by using a seller second. It's rare to find a bank that will be that aggressive though

At 10% equity injection many more banks were interested.

I think your question is searching for a way into the deal with a limited out of pocket downstroke. If this is indeed the case then yes its very doable. 

Lenders who will lend on this structured finance purchase will most likely require the buyer to have at a minimum 10% of the purchase price into the deal in the form of a capital downpayment. The Seller carry will need to make up the difference between the buyers capital downpayment and the lenders required downpayment e.g. 20, 30, 40%, etc. The deal will also need to cover DSCR (if it doesn't, try getting the Seller to carry the 2nd where interest accumulates with no payments due until a balloon payment date in the future; be careful, know you have an exit when it balloons).

My interpretation is that @Eric Schleif is looking at this from the perspective of a CRE lender whose job it is to obtain the very best financing package for his clients. He's correct its not the best in terms of outright lending options.