Posted by Russell on December 02, 2003 at 24:30:23:
Hi Mark,
I replied once to another post, but see here exactly what you are asking:
How about this:
Get a loan to purchase from Interbay Funding (70%) 2) Get the seller to take back a second for (20%) and 3) Put 10% cash down.
Heck, even if you financed the whole thing, $1.4M at 15 year amortization at 7% is only $12.5K monthly. That still leaves $6K a month in free cash flow!
Also, with these kinds of numbers, regional banks or even national banks might be interested in this deal. The only problem with that is most will only do 80% LTV, but you may find one that will allow a seller second since the cash flows are so good on the property.
I would do the due diligence and see if these numbers hold, if they do, it is a good deal.
3-story office building with extras, need ideas. - Posted by Mark - IL
Posted by Mark - IL on December 01, 2003 at 22:14:37:
Well I need some ideas on this puppy. Saw a for sale sign by owner in the downtown area of the city I live in(Central IL area.) He also has some other properties.
Property A: 3 story office building, for the year NOI is $130,320. Looks to be around 90% occupied.
Property B: Parking lot with 50 spaces. NOI for the year is $15,478.36.
Property C: Car Rental Lot (National Chain) NOI for the year is $75,481.71
He is asking 1.4 mil. Have talked to him about doing a Contract for deed with 5% down. He was less than luke warm with that offer. Than I asked him about doing a contract for a peorid of 3 years with 10% down. He said he would need to think about it and I should call him back next week. Owner is selling because he wants to retire. He sent me a 15 page fax that goes into some detail about all 3 parcels. I know there is alot of due diligence that needs to be done on my part, but before I go through the hoops I want to know if I can finance the deal.
It looks like it is throwing off a postive cash flow of over 18,000 even with debt service added to this it should throw off a great cash flow.
I am wondering if there is a creative way for me to present an offer that would be attractive to him instead of the standard going to the bank and getting financing at 20%-30% LTV.
Also are there commercial lenders out there that will lend maybe at 90% LTV. My Fico score is 682. I am open to any input that you guys may have as well as know of a lender that might be interested in servicing this loan. Thanks in advance.