Motel finance

Motels can be a great investment if your going to run one yourself however a lot of financial intuitions do not like them and you will be hard pressed anyone who lends above 65% on a motel so to even start looking at this option you will need to either have a lot of cash or equity before applying for motel finance another downfall with motel finance is the interest rate is usually extremely high compared to a general commercial mortgaged interest rates.

There is one well known way around this is by using low doc finance and telling the lender you are buying the place as your residents this way you can get a residential mortgage interest rate however the motel can generally not have any more then 6 units in the building to be eligible for residential finance if you can buy a motel that makes a good income this way you will be laughing as your paying half the costs in interest then your competitors on their finance for your motel because you simply researched instead of jumping in feet first.

You will need to do a lot of research before picking the motel you want like checking out occupancy rates how long it has being profitable and if there is areason that the occupancy rates are a lot higher then last year this could be something is being constructed in town and a lot of workers are staying there this would be a bad choice because as soon as the work is finished so will the occupancy rate of your motel

So in conclusion does lots of research try for a 6-unit motel to get residential finance as opposed to specialized commercial interest rate, which will bring your overheads down dramatically.