Buying a converted house... Financing?? - Posted by Corey ND

Real Estate Investing Apartments
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Posted by Corey ND on November 15, 2002 at 16:35:24:

Talked to 2 mortgage brokers today. They said if the house will appraise for the purchase price without the garage it shouldn’t be a problem. They would consider the garage as just extra space. Didn’t sound like a big issue to the 2 I talked to.

Thanks for the feedback.

Corey

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Buying a converted house… Financing?? - Posted by Corey ND

Posted by Corey ND on November 15, 2002 at 09:53:33:

Looking at buying a large house that was converted into a 4 plex. BUT the detached garage was also converted into a eff. apt. Making 5 units.

My problem is what will residential mortgage companies say about this? Would they still finance it, because they generally will not do anything over a 4 plex on a residential mortgage. Or because it is over a 4 plex will they turn it down? Could I maybe say I am NOT going to rent the garage or maybe say I am converting the garage back into a garage?

The house cash flows nicely. Is in good shape and is zoned properly.

Any suggestions?

I have also posted this on the main board.

Thanks!

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Re: Buying a converted house… Financing?? - Posted by Gmann

Posted by Gmann on November 15, 2002 at 14:47:04:

You are correct about >4 units. It is outside of the guidelines of residential lenders. 5+ units = commercial. See if you can get rid of the kitchen and bath and in the efficiency and so you can call it storage. You might even get a higher rent/sq ft. if you rent it to the other tenants for storage. They would probably pay a higher price than a mini storage because it is right there. Just a thought.

Best of Luck!