HERE’S WHAT THE DEAL LOOKS LIKE,IT’S NOT PROFORMA,CURRENT NUMBERS.
ASKING PRICE $1,250,000 GROSS $325,272 EXPENSES $144,966 CASH FLOW $58,126
MY BIGGEST PROBLEM LOOKING AT IT,SELLER IS PAYING FOR EVERYTHING FROM OIL TO EVEN THE LIGHTS IN THE UNITS. SELLER IS WILLING TO CARRY 15% SECOND ,I HAVE FOUND BROKERS THAT WILL DO 80% SO FAR,NO ONE WILL DO 85% AND OWNER SECOND. CAN YOU GUYS HELP ME STRUCTURE THIS DEAL.SELLER ONLY WANTS TO CARRY 15% NO MORE,I TRIED TO MAKE HIM DO 20%.IF CALCULATION IS RIGHT,THERE SHOULD BE ENOUGH EQUITY TO WORK OUT A NO DOWN DEAL.CAN YOU GUYS HELP ME,PLEASE. THIS COULD BE MY FIRST.I’VE BEEN LOOKING FOR 5 MONTHS AND I HAVEN’T SEEN ANYTHING THIS OK YET.
WHY ARE YOU YELLING???
CAUSE HE NEEDS HELP!
shhhhh! be vewy quiet…
Why…are we huntin’ wabbits?
Offer the seller 20% down with installments…such as 10% now, 5% 6 months, 5% 12 months. Or anything else that makes sense for all parties. I’ve used this successfully both buying and selling. If the seller told his buddy down at the barbershop that he can get 20% down and you only offered 15%, he will look foolish to his buddy. But if you offer 20% with terms, he can brag that he got what he predicted.
This may or may not apply but I learned this from Jimmy Napier over 20 years ago in his negotiating course…just rename what you are doing to fit the seller’s needs and he might just say yes.
Restructure some of the terms where everyone wins…it does not have to be a traditional deal. You might even ask, what are you planning to do with the 20% money I give you as a down payment…I know most people will cringe at this but just ask! What if he says, for example, I plan to pay off my car…well, use that balance of the car note as a credit towards the down payment and just assume his monthly obligation until you can refinance your entire project.
This is one example but if you start asking more questions and make alternative and creative offers, keeping in mind you want to solve your seller’s problems (why do you need that down payment money), then there is a good chance to restructure the deal and close this transaction.
This creative thinking has helped me buy and sell 400 properties over the past 21 years. Hope this helps.
Rob