When searching for quality Apt Bldgs to acquire....

Question

I've noticed a lot of motived sellers willing to seller finance 70 to 80%. But are there any gap or down payment lenders in this space that will take an equity stake in the property or charge a slightly high rate for doing so?

Jackie Carmichael · Answer

David — great question. A lot of investors are seeing exactly what you’re describing right now: seller financing covering 70–80%, but still needing that last 20–30% to make the deal work.

A few common approaches I’ve seen:

• Preferred Equity / JV Partner: An equity partner comes in for the down payment, takes a share of cash flow and equity upside.

• Mezzanine / Gap Funding: Higher-rate, short-term capital that fills the 10–20% gap and sits behind the senior/seller note. Typically priced higher, but it’s still cheaper than giving up permanent equity.

• Bridge-to-Perm Structures: Use a short-term bridge loan for higher leverage to close, then refinance once you stabilize or improve the property.

On my side, I work with investors nationwide on multifamily and mixed-use financing (both short-term bridge and long-term rental/DSCR). For the gap, we sometimes see creative structures that combine private lenders with seller financing to get you into deals without over-diluting.

Curious — are you looking more at mid-size (10–40 unit) properties, or larger apartments in the 50+ range? That’ll help shape which structures are realistic.