Private Financing for an Apartment Complex

4 Replies

I have been reading as many books as I can to educate myself on how to purchase an apartment building using private financing. But, due to my inexperience on this subject I'm a bit confused about something.

I have read (in the blog) about other BP member's  who have purchased an apartment complex using 100% private investor funds. I'm trying to figure out what do I need to bring to the table to convince an investor to do the same for me? Is finding and negotiating a great win-win deal enough or is there more to it?

Can someone explain this to me?

Thank you. 

@Don Yacono ,

I would recommend checking out http://www.themichaelblank.com/. Michael has been on the podcast and is a regular contributor to BP (profile: https://www.biggerpockets.com/users/MichaelBlank/). His expertise is doing exactly what you are asking about. He has a lot of free resources available to help you wrap your head around how you can bring value to an apartment deal. 

I'm about to close on a small apartment building with 100% private financing. For me it was about building a relationship and establishing a track record. I've done numerous deals in the past with this individual. Initially I put money down and did smaller deals and as I've proven myself (and they continued to get burnt in the stock market) they've become way more comfortable to the point where I can get them to finance the whole thing. In my experience you're going to be hard pressed to find 100% financing if this is your first deal unless your source of funding is a relative or good friend.

I work for a private money lender. Not sure how to get you to 100% financing. But with someone like us you could get 75% financing and then get a second behind us for an additional 15%. It's a CLTV of 90% which means you'd have to come in with 10%. You may be able to find a lender who's okay with doing a CLTV of 100%. Just a thought.