Posted by Ryan Steele on September 15, 2004 at 10:16:47:
Pradeep,
Well for mortgage purposes anything 5 units or more is considered commercial. However, just because the standard commercial loan is over 20 years, does NOT mean you can not get a loan for 30 years, or at least amortorized over 30 years. If you need help finding one of those, let me know I can point you in the right direction.
As to the depreciation, check with you local laws as each area is responsible for determining that I do believe.
I have put in a bid for an 8 unit apartment building in NJ. For the purpose of securing a loan, is this considered a commercial (20 year mortgage) or a residential (30 year mortgage) property?
The bottom line numbers look very different when I do a 20 year verses a 30 year mortgage.
Also, is the depericiation for tax purpose 39 years (commercial)or 27.5 years (residential)?