Twenty things that cost me money to learn.

A decline is one bank's credit appetite on one particular week, not a verdict on your building. Local community banks are your best odds by a wide margin — the big nationals will route you to a scorecard. Ask for a commercial loan officer by name and say: “I wanted to run an opportunity by you. I'm buying [property] in [location]. I have a tenant in tow and should have the lease done well before due diligence ends. I'd like to get a term sheet if possible.”

Banks calculate two ceilings and you always get the smaller one: roughly 80% of cost, or whatever debt service keeps coverage at 1.25 times your NOI. Work out both before you call anybody. Knowing which one binds tells you instantly whether your problem is the price or the rent.

If the term sheet says 1%, ask for 0.50%. On a $640,000 loan that is $6,400 versus $3,200 for one sentence, and they have the room. While you are there, ask plainly whether that is the best they can do on the rate. Bankers have discretion they do not volunteer.

A lower cap rate produces a higher value, so underwriting at 9 is deliberately pessimistic — which means the appraisal can only surprise you in a direction you can absorb. Underwrite at a 7, meet an appraiser who sees 8.5, and your refinance can come in below your existing payoff.

If a bank tells you twelve months before you can refinance, that is their rule. Plenty of lenders will go shorter on a long lease with a national tenant, and some will look at six months. Shaving half a year off the wait is half a year earlier your capital is back out working.

About $1,500 against a liability with no ceiling. I skipped it once on a building that did not look like a risk — it had been a gas station. Twelve thousand dollars in unplanned Phase II work, no leverage because I already owned it, and I permanently lost the innocent landowner defense. The information was in the public record the whole time.

Lead with what they get, not what you need: this is what gets your building sold now, at your price, without waiting for an all-cash buyer. Short horizon because you will refinance after seasoning, and no prepayment penalty so you can. Plenty of sellers who refuse “seller financing” will say yes to that sentence.

If you are building to suit, ask the tenant to pay partial rent through the build. A construction period is months of carrying debt on a building that produces nothing, and that is where people run out of money. On one of my deals half rent covered the mortgage the entire way. Nobody offers this — you have to ask.

A sale often triggers a reassessment. Underwrite the number you will actually pay after closing, not the one on the current bill, or your NOI is wrong before you start.

A guessed premium moves your NOI, which moves your DSCR, which can move your loan. Then the real binder comes in higher and your file gets re-underwritten late in the process. Five minutes now, or a problem at week six.

One page: the request, the tenant, the lease, the property, the underwriting, why the credit works, and the risks with honest mitigants. Almost nobody does this, and it means you frame your own deal before a credit analyst frames it for you.

A loan package with no risks section reads as naive, and a credit officer who notices that discounts everything else you wrote. Single-tenant concentration, renewal risk, re-tenanting cost. Raising them yourself is what someone who has done this before does.

Appraiser independence bans pressure, not information. When an appraiser lacks facts they assume conservatively, because conservative is defensible. Hand over the lease, the tenant's credit, the construction costs, the comps. Walk the building with them. You may even share your own opinion of value with reasoning — what you may never do is tell them what number to reach.

Square footage, ceiling height, power, parking, dock and drive-in doors, location radius, timing. Now you are not searching for buildings — you are searching for one building.

You cannot out-experience a seasoned investor on your first acquisition. You can absolutely out-prepare them, and the bank cannot tell the difference between a careful beginner and a veteran when the file is complete, consistent, and honest.

Value is income divided by a cap rate, so it is tempting to buy something cheap, put an enormous rent on it, and watch the spreadsheet manufacture equity. That is the single most dangerous idea in this business. The appraiser will not capitalize above-market rent, so the value never shows up in your refinance anyway. Worse, the day that tenant leaves you re-lease at what the market actually pays — with debt sized on the inflated number. Coverage does not get tight, it inverts. Ask it plainly before you sign: if this tenant walked out tomorrow, could I re-lease this at this rent? If no, you do not have an asset, you have a countdown. Charge market rent and let the spread come from buying well.

First-time buyers see a diligence list and assume they personally read the title commitment, interpret the Phase I, and evaluate the survey. You do not. Your job is to hire the right people, make sure every item actually happens, and ask good questions when it comes back. Deals rarely go wrong because the operator read title badly — they go wrong because nobody read it and everyone assumed somebody else had. Book thirty minutes with your attorney once title and the lease review are done, and never accept a one-line email saying it all looks fine. The best question to ask: “if you were buying this, what would you do differently?” Attorneys answer that one more honestly than any other.

People teach commercial real estate as a no-money-down strategy. In my experience it does not exist in any form worth recommending. The one honest exception is bringing an investor — then it is genuinely not out of your pocket, but it is very much out of somebody's, and you have given away part of the deal to get it. Plan on roughly 5% of the loan amount in actual cash, even when a seller note covers the down payment. On a $640,000 loan that is around $32,000, and it goes to closing costs, the Phase I, legal, appraisal and the reserves your lender wants to see. Most first deals do not fall apart on the loan — they fall apart at week six when the buyer budgeted for the down payment and nothing else.

Almost everyone has the same fear before the first bank call: they will look at my balance sheet and laugh. On a single-tenant commercial deal the primary source of repayment is the lease — not your salary, not your savings, not your net worth. So when your financial statement is thinner than you would like, name it rather than hoping nobody notices: “I'm early in building my portfolio and my balance sheet reflects that. What I'm bringing you is the tenant.” That is the actual argument, and bankers respond far better to a borrower who names a weakness than one who hopes it slides past.

First-time borrowers try to impress a lender with volume and it has the opposite effect. Stage one is the purchase contract, the lease, your pro forma, and a one-page cover memo. That is enough for a commercial lender to tell you within a day or two whether the credit interests them. Tax returns, your personal financial statement and entity documents come when they ask. Staging it this way also means you can put the same three documents in front of five banks in an afternoon.