OfflineYesterday I found a 15 Unit complex for sale with Owner Financing. Asking price is $498,000.00 with 15% down. All Units are occupied and its generating a Cash flow of $6,132.25 net. My question is how do I come up with the 15% down? $74,7700 is way more than I have on hand and Conventional lenders can't help because of average credit and no assests. What are some affordable optontions for my Financing of this project. I have an APOD if anyone needs a closer look, just PM me. I do have an LLC.
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try the website www.reiclub.com they have a handful of private lenders on there that do multi-property deals. Where's it at? consider wholesaling it to me if you can't find any lenders:)
Hi: 6-13-11
You can do a Master Lease Option whereas you negotiate between you and the seller a set price on the apartment building with the option to buy at a later date. My suggestion it should go out between 6 and 8 years so the building appreciates in value. In the meantime, you take over the expenses, except capital repairs, and give the owner a percentage of the monthly rental income after all expenses including the mortgage payment. That way you have tied up the property so the seller cannot sell it. The seller would be making more money this way versus an outright sell while you have the ability to buy it later on. So if you feel the $498,000.00 is a good price and you have done your research to find out that is what the apartments are going for regarding a building similar to this one then go for it. Also since the seller is willing to take back the financing, you might offer the seller more than the seller is asking if need be in your negotiations. So basically you have tied up the property for a period of time at a given price and the seller gets their full price or more plus a monthly income above what the seller is expecting due to receiving some of the monthly rental income that the two of you decide on. Also if you do a Master Lease Option put in the Agreement you can Assign the option to a third party so you could make some money in that direction as well.
Final point, the seller would not be paying taxes on the down payment the seller is requesting since there is no down payment so here again the seller ends up making more money by no tax consequence, but the seller should check with their accountant since I am not an accountant nor lawyer.
Good luck and let me know what you do...Laspen
youre in the right place for help-but if you want help please fill out your profile info so we can help you- tell us a little about yourself and where youre located(city/state) it will also help you network with others in your area to partner with and get deals done
Commercial property loans are based on the performance of the property itself not so much YOUR credit
ask me how to make this deal work after you fill out your profile info
Mike
https://tvallc.isrefer.com/go/RehabLite/renvestr/ Free tools
Sir I appologize about not having my profile completed. I just filled it out and I am very ready for some good advise and direction.
Thanks Mike,
Jacob