Cumberland, RI · Member since 2016 · 24 posts · 4 votes
So bare with me, I am not sure how to present this besides how I see it in my daydreams haha so here we go:
I picture that there is a Mobile home park ( for this example) for sale at $1 million 12% cap. Since I have just about 0 experience and $0 I can contribute, I thought about this idea. I would offer to purchase the park but for $100K for the first three years applied directly to the principle; however the seller would stay on to help train me on how to run the park correctly. At the end of the third year, I refinance and pay them 800K so in the end I would be paying $1.1 million for the property.
I guess my question is; Does this seem feasible? or is it too one sided if so which side? I am just looking for feed back
Philadelphia, PA · Member since 2016 · 73 posts · 28 votes
9y
Ignoring the 12% cap rate which may or may not be realistic your proposal would be that the property owner does the following:
Allows your to purchase the property with no money down
Trains you to run the property
Charges a significantly below market interest rate over a period of 3 years (10% over a period of 3 years)
Unless you are paying significantly over value or there are other big hidden costs not listed I don't see why a property owner would agree to this. It is extremely favorable to you and I don't really see a benefit to the property owner at all aside from offloading the property.
Cumberland, RI · Member since 2016 · 24 posts · 4 votes
9y
Thank you @Adam Sanders that is a prefect angel i needed. in my head I thought it was GREAT! haha well out of the three keys you pointed out, right now the first one is a must ( as i do not have any money to put down) the second point is just a want so that I do not mess things up to badly. and the final point was supposed to make the deal so sweet it would be hard to turn down. Would is make more sense to just pay full price at the end of the 3 three years? either market or original list price? therefore it is a 10% interest per year? I am trying to get other Ideas also on how to purchase a property with $0 cash down ( yes I am willing to do a lot of sweat equity and other tasks)