Has Anyone Ever Heard Of Owner L/O An Apartment Complex To A Buyer?
Just something, I am wondering...been trying to find my way in the Apartment Complex investing all day.
Could I possibly talk an owner into letting me buy his/her apartment complex Subject to his/her existing financing, of course he/she would take % of the profit every month, and eventually 3 yrs later I could qualify to finance the property and pay off the owners Financing and he/she making $$$ from equity...I don't know why I felt I had to explain that, lol, obviously you know what I was talking about.
But is this unheard of? Or could this possibly be the way I could get my "foot in the door" so to speak?
JB
[addsig]
Yes, it's called a MASTER LEASE with Option to Purchase.
You either need to talk to a local investor who has bought like this, a creative real estate attorney, or buy a course.
It works just like a L/O would on a house. just different due diligence and different paper work.
Could you tell me where to find a course on this?
WoW.....You have just made my day!!
JB
This time my Signature will be Yelling out Loud!!
[addsig]
You can buy apartments via lease option, sub. to, wraparound, seller seconds, seller financing, etc.
Pretty much, anything you'll read in the forums about houses are things that you can do to buy REAL ESTATE not JUST houses.
I've talked to sellers who agreed to do this (but at the end of the day the numbers didn't make sense).
The one thing that is very different is that when you refi your multi you're going to have to have 20-25% equity or cash in the deal. So as long as you can buy it, generate more income, have it re appraised for 25-33% more than you bought it for, you're in business.
Quote:
On 2004-03-20 14:01, hibby76 wrote:
You can buy apartments via lease option, sub. to, wraparound, seller seconds, seller financing, etc.
Pretty much, anything you'll read in the forums about houses are things that you can do to buy REAL ESTATE not JUST houses.
I've talked to sellers who agreed to do this (but at the end of the day the numbers didn't make sense).
The one thing that is very different is that when you refi your multi you're going to have to have 20-25% equity or cash in the deal. So as long as you can buy it, generate more income, have it re appraised for 25-33% more than you bought it for, you're in business.
Well hopefully after 2 to 3 years when it comes time to finance it myself and with other investments, I should be able to come up with 25% equity with minimal problems..unless I make some bad decisions somewhere along the line.
When you say re appraised you mean after I buy or later after I buy (1 to 2 years from now). I ask because my impression of buying with a L/O was that twhen your time comes to refi , the seller will take most of the equity for profit (that will be the incentive to sell to me like this).
I'm all about this idea... now I just need to find the course or the investor to teach me how to do it, or tell me how they did it.
Or if I find a property that I am interested in...maybe the owner will know what I am talking about, and might be up for it.
JB
[addsig]
Whenever you talk to this prospective seller...put yourself in their shoes and make sure you don't sound like you don't have NO CLUE as to what your talking about. Would you want to sell a large property to someone who didn't know what they were doing.
I know you have to start somewhere. So start small and build your way up.
I know lease options are the hot thing right now on this board but what you really want to do is buy the buildings on land contract.
A lease/option is an option to purchase so when you get around to exercising your option you will need to put 25% (more or less) down.
A land contract (or a purchase money mortgage) puts you in equitable title so when you go to get your new mortgage you qualify as a refinance. This means they will underwrite the loan for 75% of value, not purchase price. In an appreciating market like yours, and especially if you've improved cash-flows by better management, that could come out to a 100% financing deal.
Mark
JB -
Peter Conti and David Finkel have a course on apartment buildings. You can find the material at www.resultsnow.com. I'm going through the course myself now.
Ryan J. Schnabel