So I'm new to investing. Posted a few questions to this forum before on things like explaining the brrr method and things like that. I've been searching for deals to get started in buy and hold... I came across a really good deal.. the catch.. it's almost a $1 million dollar investment.
Good news is the seller is willing to do some sort of financing themselves like me putting in 20% and then financing the rest through them. But either way, for a new investor who doesn't have a lot of money to invest, where do I even start with finding $1 million dollars to invest? Should I try for a business loan?
Maybe see if I can even get a $200k business loan?
Either way, here are some more of the details:
8units + 4 lots
Asking price: 950,000
Collective rent: $6,000 (but way under what it should be)
There are also 4 lots on the property that can either be developed or sold separately. If I build them, then obviously that more initial capital I need, but ultimately more units I can rent.
I doubt your seller is expecting to be in 2nd lien position with his/her $750k. If you (or a partner) don't have the $200k cash to put in, this sounds like the wrong type of deal for you.
This appears to be a bad deal. First you are buying a partial liability with the 4 lots. If they can not be separated off and sold immediately walk away.
At 1M the rents, as you have pointed out are way below what is necessary to support the investment. They need to be increases by 50% to carry the property at it's present price.