Comercial real estate..To buy and rent a multifamily unit?what are the requirements to buy a multi family unit? do you need a certain percentage down or extremely good credit? how does it work?
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Every lender is different, most require very good credit, income, and a nice size down payment. Most will only do up to 90% with Lender Paid PMI (private mortgage insurance). But check with a local mortgage broker. Good Luck!
It depends on wether you are going through a lending institution ie bank or morgange company ... or...bying the property direct from the owner. The by owner type of sale alows the owner to be somewhat flexable in the down payment and the monthly payments. But, there is still going to be a sizable down payment required.. I think about 20% would be a good figure as you start to think about this process. Obviously, you are going to know what the apartments rent for...snf the % of increase that they have shown over the past 5 years..and resonable expectations for the next 5. People do not have to buy and sell their homes..but there are ALWAYS people who need to rent an apartment. The monthly payments you would have to make would be based on the term of the loan. Also... Owning rental property sounds a lot easier than it is. Unless you have TOP NOTCH do it yourself skills..ie plumber,electrition, painter, furnace fixer, etc. it goes on and on...YOU are the one that has to fix all that stuff. Trying to hire it done will eat up any profits you are making...really fast!
It's a fun thing to think about...but a very difficult thing to ever pull of in your favor. If you really want to try this..start out with something NO bigger that a duplex...better still a home for you with an apartment in the basement or the loft or the garage or wherever..muchless risk involved...PLUS it will give you a taste for having renters!! ¦
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