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Buying a 7-unit property as an individual??

I am looking to purchase this 7-unit property for $120K as an investment property and I do not plan on living onsite. I am currently approved for a conventional loan for up to 4-unit property. And my current lender does not offer commercial loan which seems to be what I need. I have not done a commercial loan before so I have quite a few questions. 

I am planning to buy an investment property as my personal name. I have excellent credit score. If I need a commercial loan for this 7-unit property. Do I have to apply for a commercial loan as a company? How much down is required? And what are the requirements for a commercial loan?

Thanks

Crystal
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October 20 2012 - US
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Answers (2)

It is common for investors to buy properties as individuals, then transfer the property after purchse to a holding company such as an LLC or LP.  However, technically, any transfer could trigger an acceleration clause in the mortgage if the mortgage company wanted.  But, if you keep paying the note on time, the mortgage company should leave you alone.  If you do make such a transfer, make sure you add the holding company as an insured on the property insurance, or you could void the insurance policy.
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October 21 2012
The downpayment (usually higher), rates (usually higher) and fees (usually higher) are a bit different compared to most conventional products. So are the terms so ask questions and pay attention. In my experience it is way more pleasurable to work with commercial loan products--fast, efficient and my clients usually qualify for more! I hope you find a good company to work with.
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October 20 2012
 
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