What are some tricks for creative financing?

If I don't personally have much cash, what are some creative ways to obtain financing to buy an apartment complex? I see that the minimum down-payment is going to be about 15%....what are some ways to raise this capital? Do I just need to find an investor?
Can I build credit on the corporate side and be able to obtain a few million in funds?

Edited: 06/26/2010 at 08:42AM

Danielle B.

· Colorado

50 posts
131 Influence

Icon_minipost Jun 23 '09, 01:35 PM

If you don't have enough for a 20% down payment, maybe you can negotiate with the seller to them carry a second.
I work for a bridge lender that will allow seller carries on our small balance program, loans $2+ do require 15% down.

Edited: 06/26/2010 at 08:42AM

Danielle B.

· Colorado

50 posts
131 Influence

Icon_minipost Jun 23 '09, 01:37 PM

Oops, I meant $2M+

Edited: 06/26/2010 at 08:42AM

Will Barnard

Rehabber · Santa Clarita, California

7238 posts
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Icon_minipost Jun 23 '09, 02:14 PM

I would suggest starting out smaller if you don't have much cash. 100% financing on apartments can be a dangerous proposition & without a reserve account, you could lose the investment.

While there are several creative strategies for buying with full leverage, I would not recommend it to a begginner but that is only my opinion.

Edited: 06/26/2010 at 08:43AM

Will Barnard, Barnard Enterprises, Inc.
E-Mail: info@barnardenterprises.com
Website: http://www.barnardenterprises.com
info@barnardenterprises.com

H Mann

Real Estate Investor · Bay Area, California

211 posts
1575 Influence
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Icon_minipost Jun 23 '09, 02:32 PM

^ I'm not necessarily a beginner. I am only 23, but in the past few years I have learned the game.

I'm sure there are creative strategies....and I'm one of those people who can understand and catch on to "creative concepts" very quickly. I know there's a lot of people in this world who get confused and things just don't seem to make sense to them; I am NOT one of those people.

Please elaborate on your strategies.

I'm open to anything: multi-corp strategies, leveraging hard-money, ANYTHING.

Edited: 06/26/2010 at 08:43AM

Justin Scarborough

Real Estate Investor · Ohio

36 posts
196 Influence

Icon_minipost Jun 23 '09, 02:58 PM

How many deals have you done while learning the game? If you have read a few books that's a start. But I think you would need real world experience and a proven track record before an investor will risk his money with you.

You should listen to what Will suggested. Starting smaller will allow you to learn the basics.

Edited: 06/26/2010 at 08:43AM

Jim Wineinger

Real Estate Investor · ten mile, Tennessee

1501 posts
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Icon_minipost Jun 23 '09, 02:59 PM

Originally posted by H Mann

^ I'm not necessarily a beginner. I am only 23, but in the past few years I have learned the game.

I'm sure there are creative strategies....and I'm one of those people who can understand and catch on to "creative concepts" very quickly. I know there's a lot of people in this world who get confused and things just don't seem to make sense to them; I am NOT one of those people.

Please elaborate on your strategies.

I'm open to anything: multi-corp strategies, leveraging hard-money, ANYTHING.

If you have "learned the game" then you know the strategies.
These strategies have been explained many times on the forum here. Sounds to me like you still have a lot of reading to do.
Use the search function putting in all the "keywords" you can think of and read all about them.
There are really no "secrets" or tricks involved but tried and true strategies that will keep you from loosing what you do have and allow you to make more. The more you have the more you can leverage to your advantage.
But to leverage yourself over what you can afford with what you currently have, is a recipe for certain disaster. It is what brought us to the brink of what is happening right now with the economy.

Edited: 06/26/2010 at 08:43AM by Jim Wineinger

H Mann

Real Estate Investor · Bay Area, California

211 posts
1575 Influence
2 Awards

Icon_minipost Jun 23 '09, 04:16 PM

Are there any lenders out there that aren't concerned about CLTV? Meaning, is there a bank that will finance 80% and not be concerned about the seller carrying 20% to make it a full 100% CLTV?

Edited: 06/26/2010 at 08:43AM

Jim Wineinger

Real Estate Investor · ten mile, Tennessee

1501 posts
16138 Influence
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Icon_minipost Jun 23 '09, 04:30 PM

Probably not, since most are in some way backed by FHA VA FANNIE and or FREDDIE which have recently closed that loophole that allowed for financing of the downpayment.
Most will make you sign a form that the downpayment is your money (except for family "gifts") which would make a seller assissted downpayment fradulent.

Edited: 06/26/2010 at 08:43AM

Scott M.

Real Estate Investor · Rochester Hills, Michigan

632 posts
4345 Influence
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Icon_minipost Jun 23 '09, 10:42 PM

partner with someone who has the money / experience / knowledge.

Edited: 06/26/2010 at 08:43AM