Hey Guys!
I’ve run into a 13 unit property ( 3 triplexes and 1 four-plex). 2 of the triplex are at 65,000, and the rest 2 are at 75000 a piece. cash flows after expenses at 2000. Owner is downsizing property and needs to sell. He is will to do a seller finance, or carry down payments…I have made contact, spoken with him, but not yet made an offer.
Assuming after my due diligence, I decide to go ahead with this deal—how do i go about structuring the deal. I know from my conversation, the seller is willing to work with a buyer to make the sale happen, he is more interested in the terms than the cash (i think), he wants to know the property will be cared and maintained for…I’m just stuck trying to figure out how a seller financing can factor in with hard money lenders. Basically, I need assistance structuring this deal creatively :banghead. Thank you guys, and I anticipate a response.
Hey Jason,
Ok, a total 13 units in four individual properties.
I would ask the property owner to allow you to take all four properties, no money down and ask him to finance the property subject to any underlying loans!
It’s Bold, takes confidence and shows you have gut’s.
Ask him for a 30 year payment structure due in 5 years, set up a fair interest rate (Say 8%) and pay him under an excelerated payment structure bi-weekly which excelerates the mortgage paydown over 5 years about 20%.
This way you are assured of having 20% equity and having a re-financing option as a way to allow him to exit, of course you could always choose to sell in 5 years.
Set up a escrow account to handle direct payments to him and any underlying lenders bi-monthly and ensures a recorded payment history for refinancing.
As the say “Go Big or Go Home”!
Do you have what it takes to “Go For It”?