Your a little off on the mortgage figures. $300,000 at 8% for 20 years would be $2,509 per month and then the $295,000 at 8% for 20 years would be another $2,467 per month. This would total $$4,976 per month. You had also mentioned that the seller wanted $300,000 cash and then would take a first mortage on the balance. The principal lender will want the first mortage and then the seller would be stuck with a second position on the mortgage, which may be unacceptable to him. Good luck.
Ok, this is a two-question posting. This is regarding the building I live in which is up for sale at an asking price of $595,000. Owner is looking for at least $300,000 cash and will take a 1st mortgage for the remaining $295,000 over 20 years. I’ve done a cash-flow analysis with some pretty reliable figures. Both the owners figures and my research seem to match, and I inflated some of the expenses for extra measure. However, I know the owner is selling low, but my positive cash flow came out to $2,693 per month!! QUESTION. Did I compute my mortgage payments correctly? I figured for a 1st mortgage of $300,000 and a second of $295,000 (total of $595,000 selling price) at 8% the monthly payment came out to be $2692 per month total for a 17-unit property. Is this figure too low??
Also, would it be prudent to bring my partner in on this as an added income/person/credit etc. for the bank being that this deal is so big. Neither of us have the greatest credit but we do have a decent combined income (about $90,000). My question is will this make any diffrence to the bank as we don’t have alot in savings, collateral, or debt for that matter.