Do all Banks require Down Payment to be sourced for 90 Days?


#1

Hello to all,
I am looking to purchase a park. I am seeking finance options one of which is via Bank Loan. They are saying I need 25% down and needs to be secured (sourceable) for at least 90-days. The Loan amount is $230,000 with $57,500.00 down. I am looking to get an investor for the Down Payment and finance the rest. Any thoughts on other options?


#2

Few things, i have had this on a single family home purchase. Im not sure that on commercial loans i have done if they verified source of funds or not.

And just be cautious, aside from being transparent with the lender, if you are "borrowing " the down and need to provide a repayment of that and this is actually structured as a %100 leveraged deal, that you have room for error and some type of buffer .


#3

Marvel,
Thank you for your response. All make sense. Yes, I have had the same situation occur, down payments being sourced. I was surprised to hear the Account Executive same the same thing.
The current numbers do have room for 100% leveraged deal. Now I am looking to find investors.


#4

Does it make sense to just get your partner on the front end, create your LLC with them being the contributor of capital if they are willing to sign on the loan ( which it sounds like what needs to be done to satisfy the bank on this one? ) You can shop it to different banks.

Most banks on the commercial side i deal with are at least asking for PFS personal financial statement . So if you show up and dont have assets and no cash, thats typically going to be a red flag.


#5

Marvel,
Yes, sir, that does make sense. Thank you for enlightening me on this approach.


#6

Marvel,
Do you know any investors or a way to source them out?


#7

There are rules on syndicating and sourcing investors so i dont know what specifically violates that. The first thing I would do is post on this forum on your deal and see if you can generate any interest. Assuming you have it tied up , you can post the rough numbers, the general region , and what you need ( and if you have any real estate experience, gone to the bootcamp / etc)


#8

Marvel,
Great feedback. I am not under contract. I do not wish to sign anything unless I can source the funds. I have the numbers and pro-Forma for the next 5 years just looking for an investor to team up with. I like the idea on the LLC approach. Makes sense and protects both parties.


#9

Maybe go to some of your local Real Estate Clubs and see who is investing in deals, who might be interested in this deal.

If you are looking to get into parks , the MHU bootcamp is kind of the gold standard for a prelim education.

And work on saving funds for a down payment , getting the personal house in financial order so you are better prepared on something like this.


#10

I can help with that to delete the banks from transaction and you can stay in as partner with no money down. Call me 989-313-7829


#11

This is typical anti money laundering stuff. You should not get a loan and conceal the source of money for down payment unless you are not worried about going to prison for fraud. The bank wants to know whose “skin” is going to be in the game.


#12

I once had a lender explain to me that the 90 day thing was to make sure that the seller was not the one giving you money for the down payment. Not sure if that’s true but thought it was interesting. :thinking:


#13

Dana leigh is a good contact for loans
Dleigh@11capitalfinance.com
She can discuss your options