I want to know how to get cash back at closing.
David, can you provide some details? Usually you can negotiate for cash back to cover closing costs, but in most cases nowadays, it is hard to get actual cash back when you close (with the exception of being the real estate broker as well).
Ranked in order of easiest to hardest in my opinion.
1. Find a money partner that fronts all the money and gives you an acquisition fee and a slice of the profits (or prepays some profit upfront).
2. Find a lender that will loan you more than you're paying. Almost no banks will do this, private parties and hard money lenders are more likely to do this. AKA find a really-really great deal and this is possible.
3. Find a seller that will carry some of the purchase and subordinate to a new lender. You buy a property for 200,000 that is worth 300,000. The Seller is willing to carry 75,000 for 12-months in 2nd position. Get a lender to loan you 150,000 in 1st position. Seller gets 125,000 you get 25,000 less fees.
4. Buy a subject-2 deal that is under water or 0% equity and have the Seller pay closing costs.
5. Buy an apartment that is under water. Seller to pay closing costs. You get security deposit pro-rations and pro-rated rents.
6. Buyer a package of 10 houses and 65% ARV from one Seller. Assign 9 of them at 77% ARV. You just got a free house.
It is possible. Not easy. I have bought subject-2 houses for $1. I still end up sunk 5-10k. By the time I evict/rehab it.
The only way I have regularly accomplished is through my hard money lender over funding details, but I almost always had to put in money upfront to get it back later.
Most of the time it is more profitable to find a partner with money and just use some of their cash to chase good deals versus trying to catch a unicorn. Looking for cash back or no cash deals will probably eliminate 98% of the potential deals and many of my above examples are probably not smartest of investments.
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