Owner finance?

Hi everyone. I could use your thoughts on this. An investor in my area is looking to sell of his mutifams. I think he has about 15 or 20. The tenant stress is getting to him and he wants out. I talked with him a few months ago to pick his brain because I’m a newbie. He sounded like he had a lot of properties but not a lot of money. He even said at one point " robbing peter to give to paul". I got the impression he was way overleveraged. I haven’t been able to talk directly with him about his current situation, but he says he will do 100% financing. It may be a case of mismanagement. I would want to buy the buildings vacant because I think he just rented to anyone and now has problems. Can you guys give me some other red flags to watch out for when I talk to this guy? Thanx.


You are thinking about buying with 100% seller financing? If the seller is overleveraged at his equity position, you are just taking over his problem and making it worse.

It sounds like he is hiring a commissioned property manager and the commission may be negative… So I have to agree with DaveT.

Unless you can show that the units are way under rented and can be increased to a point that you can turn and make a profit I wouldn’t take someone else’s troubles…

Although there are those who have made a fortune in the fertilizer business…

Michael Quarles

Well the numbers would have to for me if I were to consider anything. I’m not worried about the rent roll because I want the properties empty. I’m more concerned about edt coverage and expenses. Fortunately it easier to get actual real numbers. The expense that would be hard to look up is the actual maintenace cost of the property. But I think I can get a decent estimate after a little detective work. Bit I have a sense that the numbers won’t work. Aside from that, are there any tricks or red flags that I should be looking for?