Real Estate Investment: Agreement of Purchase - Should a COMERCIAL form be used or RESIDENTIAL in this case..?
I am putting an offer to purchase a property.
It's a 4-plex with a Boucher shop on the main floor. so 4 residential units being rented out plus Boucher shop currently operated by the Seller.
The zoning based on City Planning Department is RESIDENTIAL.
After the purchase I do not plan to operate any store or Boucher shop there meaning the use will be 100% residential.
However, currently one can say its use is commercial/residential mix.
My question is what form should I use to put an offer - COMMERICAL Agreement of purchase or RESIDENTIAL Agreement of Purchase? I think some banks and lawyers treat commercial different than residential.
How will the bank decide whether it’s residential or commercial:
- Current use? (=residential/commercial mix) or
- Future use by buyer/me? (=residential only) or
- City Zoning? (residential)
- 1 decade agoFavorite Answer
Before you even write the purchase agreement, you should be looking at 2 things: whether or not you can convert the building to completely residential and whether your bank will loan you the money one way or the other on this property. Whether you have a commercial or residential purchase agreement will not matter because the bank will send out an appraiser and if you are trying to get this through as a residential property and the appraiser considers it to be a commercial property, you will not get your loan. So talk to your bank, talk to the municipality and then make your decision. What kind of purchase agreement you use would make no difference whatsoever.
- Bad Co.Lv 51 decade ago
I believe you should use a residential purchase form, or a multi family dwelling form if there is such thing. Just put in additional info part weather the lease will be honored to the current renters of the retail part and that when lease has expired that it will be multi family or solely residential. If seller's object, then just do and addendum. Good LuckSource(s): Agent, but our states may be different. I also believe that the lender are more stringent on commercial sales.
- stropusLv 44 years ago
you do no longer decide on a criminal professional, you decide on a stable realtor. you could back out each and each of how as much as last, yet devoid of contingencies, etc., you will lose your earnest money. a million. figuring out to purchase a house is a huge dedication, you're able to have a realtor. in the event that they have a realtor, you decide on one. 2. Grand scheme of issues $1000 isn't a lot. in case you do no longer experience comfortable with the deal, walk away. 3. whilst dealing with the service provider, they may well be inspired sufficient to sell the homestead that they could fairly regulate the settlement than see the deal fall via. 4. consistently make issues contingent on an inspection. consistently have the homestead inspected. as quickly as the inspection is finished, you initiate negotiating in keeping with issues which would be repaired or as much as date, etc. On Monday, get a realtor. How do you decide on a realtor. Ask them how some years they have been interior the corporation. what proportion residences they often close each and each month. Ask who the broking service is. Ask what sort of sources they often deal in. Ask human beings you recognize who they used, ask the guy who works on the economic institution who they used. heavily, i understand you have become on the ingredient of the top and you think of you could keep a pair of dollars via skipping the realtor, yet actual if your place seems to be a lemon, or you overpay, it's going to be on the grounds which you probably did no longer have a realtor, and you will spend countless cases the value of having one on issues that by no potential could have been issues.
- 1 decade ago
You would think the banks would go with the city zoning if they were smart, but who knows anymore what the banks are going to do to us. :P
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- kemperkLv 71 decade ago
1-4 units, res
if you want the best deal, at no cost to you,
find a rare commercial BUYER's agent
[if you need help, I can find one for you]Source(s): RE broker