Can you obtain financing on a apt. building with a negative cash flow?

If I paid all cash for a building with negative NOI and immediately wanted to get a equity LOC or equity Loan to pull my cash back out would a bank give me either of these loans on a property with a negative yearl NOI? I am assuming they would not because I would fail to meet any DSCR requirements. Even though the property appraised at $100k and I am paying $85k I'd still have to meet their DSCR numbers right?
In Buying Property - Asked by Jacob C. - Jan 29, 2009
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Answer(s)

Joe V.
Owner/Investor
Plymouth, MI

Why would you buy any commercial project for cash that has a negative cash flow when there are so many that you could get 100% financing for and still have positive cash flow?

Jan 31, 2009
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Jacob C.
Owner/Investor
Washington, DC

Joe. V, that is kind of what I am asking. Also the property has a lot of potential because it is currently seriously mismanaged but if I can't pull out my cash to fund the renovations because I cannot meet a banks DSCR due to the negative cash flow then this deal is sunk and I'm moving on to the next. Thanks.

Feb 2, 2009
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Tai L.
Broker/Agent
San Diego, CA

Did you try SBA loans or check if there are city programs out there?

May 22, 2009
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