OfflineI have a partner who has secured a property, however, we do not have a means to purchase the property at this time! The property has a FMV $150,000 alongwith an adjoining/second lot FMV $120,000 (two parcels of land in all). No property was built on the second lot, except a large garage used for woodworking, RV, mechanics, etc.
Total FMV approx. $270,000.... My partner was able to gain the property for a great price!!! The only problem we are having is neither of us have ANY $$$ to secure the property and the contract has been extended for another month to secure funds!!!!
What we need from the DG family is an EXIT strategy to buy the property, which will put a HUGE profit in our pockets!!!!
Please offer your expertise in order to help us from losing this property????
Thanks so much!!! P.S. We don't want to buy/hold if we don't have to... but, will keep the property once we can secure funding!!! HELP!!!!!
First and foremost, have you tried to get the seller to finance the deal? This would be the ideal route. Structure with a decent interest rate or even an equity share when you sell the property.
Depending on the FMV, you may be able to obtain a Hard Money Lender. Most won't exceed 60%-65% of the value of the property. Keep in mind most HMLs have 6-12 month terms so the property would have to be sold or refinanced within that time frame.
You could also take on a partner with cash and offer a very healthy return on their investment or an equity share when the property sells.
Worst case scenario, you could assign your contract to another investor for an assignment fee. You won't make as much money but something is better than nothing. Keep in mind, you are on the hook until the property closes so make sure you are dealing with an investor you trust to follow through with the purchase.
Hope this helps.
CTP
I like your first idea, I would have suggested the same but I never thought of an equity share for the seller when the property is sold.
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That is a fantastic idea! Love it!
(Going to put that in my notebook of good ideas!
Angela
First things first. As a New investor with Little capital you should ONLY be buying property that has INCOME...ie cashflow etc.....Second...It's fine to go ahead and lock a deal on property, however it IS more difficult to sell bare land than it is IMPROVED land. I would say you should MARKET the property and try to assign it unless you can come up with a plan that allows you to fund it. Even if you DO fund it that plan should figure on how you can somehow offset the mortgage...ie....is the land possible to lease out? Could Fencing it allow for people to store RV's on it...Would that be legal?...Could you Lease it as Farm land?.....Be creative as to how you could keep it and make it pay for itself. Can you sell ONE lot and with the profit pay down the other? BE CREATIVE....Brainstorm it. MAKE IT HAPPEN.
SAM
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