Chicken and Egg when finding a deal

[Thadeous Larkin]

Hi BP!

This may be a silly question from a total newbie, but I'd appreciate your guidance.

Hypothetical - I find a buy-and-hold property that, when I run the numbers, looks like a great deal (12% Cash on Cash ROI, ~$1,000/mo cashflow). Color me interested, right?

Now, here's my chicken and the egg issue that I'm getting stuck on.  I don't have the cash on hand to purchase, and I don't have financing lined up.  Do I:

1)  Open a discussion with the seller to get more information about the property itself?  That seems to lead to negotiations where I'm not yet financially prepared to make any offers.

or

2)  Present this potential deal to potential financiers half-cocked with not a lot of information?

or

3)  Something else.

I'm getting all spun around the axle on this one and it's stopping my forward momentum.  Any and all help is appreciated!

[Tyler Mullen]

@Thadeous Larkin

IMO it makes more sense to have you capital/financing lined up first, then you find the best opportunity you can find asap that meets your minimum criteria.  Don't line up funds and then wait 36 months for a "perfect" opportunity, that's not how investing works.

You can find 5 potential deals and they'll all slip by unless you're ready to go with your funding.  When you have your funding ready you can still ask a seller for terms, right?