Motivated owner with no equity
a local investor with 5 units wants to sell...He has them financed with my local bank. They bank DOES NOT want to allow me to assume the loan. not sure why, I have 6 loans with them currently and a line of credit. Anyway, I have all my cash tied up in a property I am renovating...I know he would be open to a master lease for what he owes the bank and in 5 years I could get them with no money down...Any other suggestions? I want to make sure I make the right decision. He has maybe around 40k of equity in them. He has had them for 3 years. I believe they are financed on a 15 year note...Just looking for suggestions.
Thanks!
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#1 Personal Finance Contributor
- Rental Property Investor
- East Wenatchee, WA
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#1 Personal Finance Contributor
- Rental Property Investor
- East Wenatchee, WA
A master lease option sounds like it could be a viable option as long as you don't have to do a ton of work or stick a bunch of money into something you don't yet own.
I keep my LOs and MLOs under 36 months to not be considered a sale by the local bank. I like 30 months) It can be renewable with additional consideration (cash or improvements) to get you to your 60 month target. Landlording isn't for everyone. Sounds like this seller and you may be a good fit to do business @Kyle Penland!