Updated almost 11 years ago on . Most recent reply
Greed. What's it costing you?
What's better, to lose $20-25k over 20-25 years or to lose $400-500k over the same timeframe?
Congratulations if you answered $20-25k, you have a better shot at becoming a multi-millionaire entrepreneur than a well-educated banker I met with awhile back.
Here's the example:
Awhile back I had negotiated a no money down deal on an apartment building. The banker I was discussing the deal with said my price was too high. The sellers were not willing to go lower and I didn't really have any leverage since I was asking them to hold all the paper as I had no money. Sure I could've found a partner with the down payment and bought with a commercial financing upfront but I'd be losing way more over the long run to the partner than by overpaying 5 percent.
Had the deal closed, I'm confident I would've made $400+k on the deal in 20 years. Well worth over paying a little up front.
Most Popular Reply
Just be aware of the risk.
If you pay over market, in order to get the seller financing, you have no exit strategy. You're holding that property pretty much no matter what, until you pay down the note enough to build some equity.