Michael Healy The majority of Commercial Lenders will require 6-12 months of Capital Reserves, to cover monthly Mortgage Payments, Property Taxes, and Property Insurance Premiums.

With an REO auction, there's a high probability you will have to pay a 5% buyer's premium as a winning bidder.

You need to see the insurance policies, are they up to date, can  you renew with thier company on same terms or will the premiums go up when you purchase.

Then add ALL costs related to holding the property (utility costs, insurance premiums, property taxes, loan payments, etc.).Concessions: Concessions are what you give back to the buyer at closing.

You might want to look into ways of lowering your insurance premiums with mitigations.

They get  a low rent per sq ft and then the mall makes the small inline stores around them pay a premium for the profit along with the kiosks.

People who place a premium on safety are unable to make sound decisions.

You could mitigate that by factoring or even guaranteeing a number of rent payments after close in exchange for a small premium.  

I noticed that last year's auctions showed a premium averaging 10% for each lien sold, regardless of size.

@Dawn Roof,I work for a commercial lender and even with the under $500,000 loan amount premium our rates would be low 4's for a 5 year fixed amortized over 30 years (it is a hybrid product that after the first 5 years is based on 6 month libor rate.)Unfortunately I only have referrals for Chicago and don't know any commercial lenders in North Carolina.I did a quick google search of apartment lenders north carolina and a list of lenders popped up so I would recommend starting there, unless you belong to a credit union or have a community bank near you.hopefully this helps,Rob