I want to purchase apartment complex and need a xtra fast comittment so I know I can do it before I give owner a deposit. If I put down a deposit owner wants it non-refundable to take it off the street for 30 days or so. Gross rents 15K per month, NOI about 10K per month exclusive of debt service. A lot of people after this one but no one to the table with deposit yet. I can get it off the street and under contract for 10K, but again I lose if deal falls apart. numbers are good…buy for 585K, worth probably 1MM. Older couple wants out…HELP! If I get committment, I will place deposit and contract. I have 700 score. Do I do hard money then refinance? or?
If you need a quick 10K short term, go to your local citi-bank financial office and get a personal loan.
Their interest is kinda high even with good credit, but you can get the money you need in a couple of hours.
If you are going to pay it off within 60-90 days and willing to take the hit on the interest, they would be your best bet if you need the cash like yesterday.
I have the 10K…no problem. I just do not want to lose it unless comfortable that I can get funding. I guess part of investing though…risk vs. profit. I just need to get it off the street and committed to me.
The numbers sound a little too good to be true. $120K NOI for $585K that is 20.5% Cap Rate, that is unreal these days. The fact that the $10K is non-refundable is what makes this sound even more unreal. I would suspect that this property needs some major repairs and once those costs are factored in the numbers look very different. Keep pressuring the seller for 30 day inspection period at least. This way you will get a complete inspection report and you’ll know where you stand. There is a chance that these older folks are scam artists. They know something is wrong with the property and that most people won’t buy it, so they sign a contract with a non refundable deposit and in a month or two they make $10K.
Do not trust the seller or broker when they say that a lot of people are about to offer, it’s an old sales trick to get you to act faster.
The commitment letter means nothing. I seen many of those and a lot of them did not work out. Tell the seller that you are interested and show him proof that you have the downpayment money. Tell them that you are ready to sign a contract and deposit $10K in escrow, but you need a 30 or 45 day inspection period to make sure there is nothing really wrong with this property. Call up a few lenders and ask how much time that will need to close a deal like this. Some deals it takes 60 days to close, so make you you get an inspection period and then another month or 45 days to close.
Personally I prefer 30 day inspection period and then another 45 days to close. The entire 75 day period is refundable if none of the lenders come through with a loan.