How to find the right partner / lender?
I'm new to BiggerPockets so please let me know if I am post in the wrong space. This site is still new and confusing to me.
I currently have an off market deal for a multi unit in an A+ neighborhood. This is a retired friend of mine looking to get out of the landlord game. I plan to buy and hold like I do with all my homes. Being such a desirable home it is expensive for me, 550,000 about. I have a local lender who will finance with 10% down and my buddy the seller will contribute 3% towered closing costs.
a few questions:
-Is there such thing as a "Down Payment Loan?" I have over $40,000, but it looks like it will not be enough.
-Is there such thing as a short term partnerships? I would be interested in talking to people about buying in for a 6 month - year. Similar to the "Down Payment Loan" idea I have. Again the first time hearing about this I have not heard about partnerships till BiggerPockets. I have no idea how they work.
-Should I be think of different ways to fund this deal?
Thanks for your knowledge and experience,
Ray
Most Popular Reply
Hey there, congrats on finding a deal! That's the hardest part.
- yes there are options for a downpayment loan, but make sure your lender is okay with that! Some won't accept it. I'd hate to see you do all the work to secure a partnership, just for it to not be permissible at the end.
- yeah I bet a few pop up here on the thread. Generally BP doesn't like to see deal-making happen in the forums, but they might let it go on this one since you're legitimately inquisitive about the structure. Just be careful you don't get flagged too many times or they'll suspend your account.
- short term can work. Usually the shorter the loan term is the steeper the terms are. They want to make money on their money, so if it's only out for 6 months they'll have to charge you enough in those 6 months for it to be worth it to them.
- make sure you hire your own attorney to look over the paperwork. Private money is a beautiful tool, but it can get a little predatory/gross. They'll be sure to protect their investment/interests... you do the same.
PS- I see you're from Portland, Maine, and I'm officially jealous. It's one of my favorite places in the country.