What would closing costs be on a 35 unit $1.5m deal look like?
Excluding downpayment just not sure what to expect/plan for here
[{"id": "irwwjry", "text": "ask some combo of your broker/lender/title.  \n\nThis is highly contract and area dependent.  What day of the month you close on makes a significant difference too (last day = no rent credits, 1st day = a full month of rent credited).  Depends on deposits too.\n\nYour \"potential\" costs are:\n\nLegal sometimes adds their fees.\nGovernment transfer fees/other taxes.\nDeed Prep.\nTitle transaction fees.\nBroker fees.\nTile insurance fees.\nLending fees.\nAppraisal fees.\nEscrow prepays.\nFinancing fees (ie points).\n\nit is very deal specific.", "replies": [{"id": "irwyxm2", "text": "In regards to rent credits, that would be assuming all lease payments are due on the first of the month. This is often not the case.", "replies": [], "depth": 2}], "depth": 1}, {"id": "irx19um", "text": "Where are you buying a 35 unit building for 1.5?", "replies": [{"id": "irx3b0d", "text": "In a linear market where the top single family houses sell for 1-2 million and the cheapest livable houses sell for 30k lol. Average rents are $625, which I believe to be slightly low. Should average at $700-$750\n\nDamn why\u2019d this get downvoted \ud83d\ude05", "replies": [{"id": "irxfw5j", "text": "60-70 grm - Is it a bad area for your city? Not expecting much growth in your market?", "replies": [{"id": "irxgp18", "text": "Decent area, has some deferred maintenance. Not anticipating growth.", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "irxglh6", "text": "In 1981.", "replies": [], "depth": 2}, {"id": "irxsjrc", "text": "Picturing those $40k units.", "replies": [], "depth": 2}, {"id": "irxsxwp", "text": "Just saw a 30-unit, $1.6MM deal come through in the Chicago area. You should get $1k+ in rents per unit.", "replies": [{"id": "irya8ze", "text": "Where? Garfield Park?", "replies": [{"id": "iryi99i", "text": "Chicago Heights", "replies": [{"id": "is7nmz7", "text": "Yikes", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "is0pkft", "text": "I want in on this", "replies": [{"id": "is0wybv", "text": "For 1.5 for 35 units there\u2019s something seriously wrong. Either the place is about to fall down or it\u2019s in butt fuck Egypt", "replies": [{"id": "is4dklr", "text": "Probaly Detroit", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "irx437d", "text": "Ask a broker or your title company (if you have one yet).\n\n$40k/unit?  Are you in Antarctica or something?", "replies": [{"id": "irx6x75", "text": "Just has bullet holes and free lead paint!", "replies": [{"id": "is0q9a6", "text": "Only one murder a month here! They\u2019re just bad at aiming though. What\u2019s wrong with lead paint? That\u2019s what my cereal bowl is made out of", "replies": [], "depth": 3}], "depth": 2}, {"id": "irx7ghe", "text": "Waiting for a showing and I ended up reading your O block breakdown, loved reading it and also very informative. \n\nNah I live in a place that\u2019s oddly poor despite having attractive natural and economic reasons for people to move here. Linear market and population, I believe it\u2019ll grow one day when bigger groups discover the cheap housing and high ROI, which they\u2019re starting to, but I\u2019m gonna get to 100 units before I say the name on here lol", "replies": [{"id": "irx7uod", "text": "Thanks, and good for you!", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "irx6ywg", "text": "I\u2019d say $3-5k for legal on buyers side.", "replies": [], "depth": 1}, {"id": "irx7k8l", "text": "I use 3% of the loan or 1% of total in my underwriting.", "replies": [{"id": "irxa4xv", "text": "That\u2019s a good % based checker, thank you!", "replies": [], "depth": 2}], "depth": 1}, {"id": "irxtq6h", "text": "Paying from your own cash or syndicating capital from investors?\n\nHere are the most if not all costs that we look at..not including O&amp;O for syndication or fund purchases.\n- $4.5-6k Appraisal\n- $6k Survey\n- $4-5k PCA and Environmental \n- $500-$1.5k Zoning Report\n- $7-10k+ Buyer legal incl PSA draft, title objections through loan doc review and opinion letter of needed\n- $2k entity setup and certs of good standing\n- $10k+ Lender Legal\n- 1-2% Lender points (perm? / bridge?)\n- 1% mtg broker (if using)\n- $15-20k for Buyer and Lender Title Ins\n- $5k Title, recording fees etc..\n??? Rate Cap Purchase\n\nReserves - Immediate repairs (from PCA), utility, operating, prepaid insurance, taxes and rate cap repurchase if a floater loan\n\nDue Diligence fees, lease audit, financial DD -- Roof, Parking HVAC, electric, plumbing vendors all may or may not charge for a DD inspection\n\nMight be high on the title insurance. We are $10-30m in price so I'm estimating overall lower costs.", "replies": [{"id": "is0qqzx", "text": "Trying to buy with as little of my own cash as possible. Seller is willing to carry back a 20% note on it and figured I could add in a sellers assist clause into contract to get lower closing costs. Thank you for the breakdown of price!", "replies": [{"id": "is0vk07", "text": "Sounds reasonable in this stage of the market. Local or regional bank debt will probably be your key as most balance sheet lenders, debt funds and Freddie Mac small balance will not allow direct second or third liens on the property. . Be sure to ask the bank if they allow subordinate liens. It will save you a lot of time upfront. Expect recourse guarantees and expect your senior loan to end up being 65-70% LTV regardles of what they advertise or the AE tells you in the beginning the credit team and the commitee trumps everything. Sorry for the unsolicited advice, you probaby know all of this. Good luck!!", "replies": [{"id": "is0x2f1", "text": "This would be my first greater than 5 units purchase so I\u2019m happy with unsolicited advice, thank you! I\u2019d be fine with a PG, obviously not ideal but for breaking into that level it\u2019s whatever", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "irysczt", "text": "Budget for 2% to 5% of your acquisition price, depending on area and deal complexity", "replies": [], "depth": 1}, {"id": "is036u1", "text": "Wow wish my country had 35 units for 1.5m. Here it would be like10m and theyd wany 50% equity.", "replies": [], "depth": 1}]