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Follow on Google News | How To Purchase An Apartment Complex – Winston Rowe & AssociatesApartment and multifamily owners have been turning to Winston Rowe & Associates. They are a no advance fee commercial real estate advisory and due diligence firm. Contact them at 248-246-2243.
By: Winston Rowe And Associates Winston Rowe & Associates, a non investment, advisory and consulting firm that performs initial due diligence for commercial real estate transactions, that include most commercial real estate types nationwide. They have prepared this article to provide a general understanding of how to purchase a multifamily property. If you would like more information, Winston Rowe & Associates always welcomes the opportunity to speak with clients directly. The can be contacted at 248-246-2243 or visit them at http://www.winstonrowe.com Buying an apartment complex is a long, sometimes complicated, process. It’s important for you to gather as much information as you can before you make the decision to buy. Applying for a mortgage to finance an apartment complex is not at all similar to applying for a home mortgage. Apartment complexes with four or more units are commercial properties, and loans for them have different underwriting rules. Types of Properties: Decide if you want to purchase a residential apartment complex of a mixed-use building. A mixed-use building has a combination of office and residential units, but at least 80% of the space has to be residential. The complex has to have a grade of C+ or higher. This means you can’t rent the units daily or weekly, and the units can’t be single-occupancy, as in a rooming house or motel. Gather information about the building you would like to buy. You may not be able to get a loan if the building will require excessive maintenance, or if the complex has not had 90% occupancy for the three months immediately preceding your loan application. Background: Talk to local real estate agents. Get their advice about the location you have in mind. Inquire about the possibilities of future zoning changes or any public works projects that may impact an income producing property. If there are plans for a regional airport to be built a few miles away in the next few years, for example, you might find it difficult to rent out your residential units. Don’t assume that everything will remain static; look at the past history of the location and try to imagine any major changes that could be likely to take place in the future. Professional Expertise: Have the building inspected by a professional who has experience inspecting commercial buildings. Make sure the inspection covers every aspect; don’t settle for a standard inspection, which may not include trouble spots, such as a wet basement. Pay extra money if you have to for a thorough inspection that goes above and beyond what is required by mortgage lenders. If the inspection reveals serious flaws, don’t make an offer, or reduce your offer amount by the amount it would cost to make the necessary repairs. Supporting Documentation: Assemble the documents you will need for the loan application. Your real estate agent will be able to assist you in this. Most lenders require the following documents, but your lending institution may require more: The ensuing is a list of supporting documents that are required to process and underwrite (due diligence) your commercial loan request. Additional documents will be required. Financial Supporting Documents: The last three (3) years corporate tax returns The last three (3) years business tax returns Name and address of corporate bank Business Profit & Loss 3 Years, For Seller or Buyer Most recent copy of business bank statement Personal financial statement for all guarantors Use of Proceeds In An Excel Format For Cash Out Refinance Property Supporting Documents: Schedule of tenants leases Copies of Tenant Leases Schedule of Units with Square Foot Per Unit Schedule of improvements to be made with cost breakdown to subject property Exterior Photos of Subject Property Photos of Parking Lot, Street view Interior Photos of Subject Property Most Recent Appraisal Copy of the First Page of the Insurance Binder for Refinance List of All Litigation Past and Present Guarantor Supporting Documents: 4506 T executed Tri merge credit report Government issued photo ID copy – front and back Personal Financial Statement Articles of Incorporation Winston Rowe & Associates provides no upfront or advance fee due diligence and advisory services in the following states. Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington DC, West Virginia, Wisconsin, Wyoming End
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