Posted by Marc Dyer on March 20, 1999 at 19:13:49:
FJW,
I have a partner. He does have the capacity to get the financing. But how do I get him out of the deal right after purchase. Is there any way I can entice him by giving him an easy escape after the thing is bought. I was thinking that; what the original owner wont go for my partner would, in terms of financing, but I dont want to have him tied up in this deal too long.
Need help closing a deal. - Posted by Marc Dyer
Posted by Marc Dyer on March 17, 1999 at 11:14:48:
I found a great income property. I am a contractor I just finished renovating the building for the owner. There is nothing left to do. I also have enough leftover stock to maintain it for the next year. It is a six unit rented as an SRO (Single Room Occupancy) It grosses 5400.00 per month! I have been onsite at this place for about two years off and on and I know how the place works, the vacancy rate is almost nil. The owner has a property manager that sends him a fixed fee per month regardless of vacancy.I live 5 minutes from the place. The guy get his money like clockwork and he lives about two hours from the place. Now for the problem I have tried and tried with no luck to get this guy to go for some creative financing. He will not, his attitude is that “The building is fully occupied and fully renovated I am making money on the place now” The building is totally paid for and he is willing to give me a deal only on the price.
I have gone to a conventional lender who is telling me with my credit That I need 40% down and the rate is 13%
I have shopped other places but it still requires a down payment upwards of 20+ percent. They tell me I cannot borrow the down payment and to get it into the bank A.S.A.P.
The owner absolutely refuses anything but a conventional deal (He wants all the cash) because the place makes a pile of money.
He is asking for 95,000.00 the building could probably get me 115,000.00 on the open market. But the place grosses that in about two years. My problem is with the down payment is there a technique? Or am I stuck?
I have thought of having the owner taking a second for the down payment. He said no. What can I do and I have tried to be super creative. I want this house!!
Help!!!
Marc Dyer
Remember rule #1. Find the motivated seller. - Posted by FJW
Posted by FJW on March 17, 1999 at 16:03:32:
Your first sentence says it all. He already has “a great income property” and knows it. Instead of trying to buy his, find a good deal out there and maybe partner up with him. He must like your work and you. It could become a great business relationship. Good Luck.
FJW
Are there no deals that DONT require a motivated seller?? - Posted by Marc Dyer
Posted by Marc Dyer on March 18, 1999 at 09:52:20:
FJW,
I knew someone would tell me to find my own deal. But look at it this is a white elephant. The building has been renovated by me,I know every inch of the place everything. I brought this guy back from hell by taking this place off of the condemned list. Now the way I see it. I renovated a vacant property and doing it the way this guy wanted it done it would have easily cost the asking place to do the work. I can pick up the place for the cost of the work that I did on a building that grosses more than that in two years. I cant walk away from this. Surely real estate guruism is not that dependant on motivated seller’s. I need to swing this deal its way too good to pass up. This guy doesnt want a partner I already tried, you cant get numbers like that around here.
Without his motivation, there can only be… - Posted by FJW
Posted by FJW on March 19, 1999 at 09:27:16:
enticing his motivation. So far he only seems to be enticed by a full cash out. If you want it that bad(which by investing criteria, is not a good thing), you either need to find a cash partner or some way to sweeten the deal. You see the problem of not having a motivated seller, is they recognize your motivation to possess it. Naturally, they’ll try to see how far you’re willing to go. It’s not a good situation for objective evaluation. Your emotions are in control, not theirs. If he is offering a good deal even w/o the terms, it’s either put up or shut up. Find the cash somehow or someone that can get it. If not, move on.
Try this: Ask for an option. 30, 60, 90, 120 days for the agreed price. Pay as little as possible for the option. If need be, tell him you need to find a partner. Then go find one that can get the financing needed.
FJW
Try this - Posted by Ray
Posted by Ray on March 19, 1999 at 01:06:32:
Here’s a thought… If he hasn’t payed you for the renovations, is there any way you could use that as your “down payment”? Worth a looksie.
Ray