Posted by Michael Morrongiello on April 03, 2000 at 23:02:53:
Forget the banks on this one… It will be difficult to finance 5 or 6 of these properties let alone 100 all with the same seller and potentially you as the same buyer.
I would see if you can OPTION them all at a below market cash price that would then allow you to market them to “retail” end user buyers either by offering your own OWNER finacing or by allowing these buyers to get their own financing.
Try to work a deal where the seller sells to you ALL of them and agrees to finance that sale by taking back individual mortgages on each property rather than a “blanket” lien mortgage. If the seller really wants a decent lump sum of cash from the sale then some of this paper can be converted into CASH that would go to him.
We were involved recently in a sale of 35 individual properties by one burned out landlord investor to a younger investor who had more time and incentive to manage the propeties. The deal was structured so the retiring investor carried some of his equity in the form of paper and got some of his equity out in the form of CASH that was generated by the sale of the seller carry back notes he agreed to finance resulting from the sale. It was truly a WIN WIN transaction for all parties concerned.
The buyer now has resold some properties and wrapped some others. The seller got a good lump sum of cash and continues to receive monthly income on an installment sale taxable basis.