One for the Peanut Gallery

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garyrickett

357 Posts

Posted - 05/09/2008 : 09:05:18 AM

Client wants to purchase SFR for $825k. This is an actual home however the home is being used as a nursing home as it has 6 bedrooms and is currently occupied by the elderly residents. Monthy leases total approximately $18k per month. The business being run out of the home is a legitimate business.

Borrower wants to purchase as regular residential SFR however owns 3 other properties and I believe that will create a deficiency in income trying to carry this property. Unless of course we can structure the loan to debt service using the income from the leases. Maybe I am over thinking this and its just a simple residential deal using lease as income.

Borrower is stated and looking for a 70% opportunity.

Thanks,

Gary

rtrefflich

2634 Posts

Posted - 05/09/2008 : 09:09:19 AM

I've done these back in the day as a traditional residential loan. We showed the rental agreement showing what the rent was and indicated factors showing why rent was double that in the area to cover ourselves for when they did a rent survey. It was not a problem. The guy I did had six of these homes, he owned the company and the property so it worked out.

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