3rd time's a charm!! I just closed a 12 unit apartment complex for under $1500 out of pocket!
I'm a buy and hold guy with 42 units and I've built my portfolio by purchasing with no-money/low-money down land contracts and eventual permanent financing from my local bank.
The process for how I structure my deals is outlined in the following thread.
http://www.biggerpockets.com/forums/311/topics/125040-how-do-you-scale-your-business-so-quick
Anyway, back to the success story! I have tried to purchase two different 12 unit complexes in the past few years only to strike out on both of them. One of the complexes I actually whiffed at two times, two years apart. The 1st time it fell apart a week and a half from closing. Today though, I got a hit! I won't say it's a home run yet, I'll need to push hard and get it turned around. Once rehabbed and stabilized it should produce around $40k NOI with me managing it myself. Which should be around $16k a year in cash flow after permanent financing is in place.
The deal itself was as follows.
Purchase Price - $345,000
Down Payment - Prorated Taxes, Prorated Rent, Deposits, & a $30,000 blanket note on 3 of my duplexes (more info below)
Amortization - 25 years Interest Rate - 6% Balloon - 3 years (This note was $302k after all the credits)
The Note on my 3 duplexes
Loan Amount - $30,000 Interest only until the land contract is refinanced. Upon refinancing it goes to a 5 year Amortization Interest Rate - 7%
I feel I should be able to add enough value and amortize enough of the debt to be able to roll both of these notes into a new commercial loan with a local bank around the 2.5 year mark.
All 12 one bed apartments need cosmetic rehab and new exterior doors. Me and my guys will do the work (I own a painting business). I'll do the rehabs as the units turn over the 1st time. Hopefully I'll be able to move existing tenants into rehabbed units as I go to speed up the process.
Long term plan is to get it leased up at higher rents after rehabs and then refinance into permanent financing with my local bank around the two and a half year mark. I plan to hold it for 10+ years.