Rental Property Investor · Boone, IA · Member since 2019 · 55 posts · 94 votes
I own 11 doors now. I’ve always gotten a conventional loan or paid from pocket. I have great credit so it hasn’t been an issue. I have found great rentals where I’m from. Usually hitting between 1.5% and 2.5% on the rentals. For instance the last one I closed on was a 28,000$ cash deal with about 1,000$ repairs to put in a tenant at 650$ a month.
I would love to have another investor or several so I can pull the trigger on these properties faster and not lose out on them. I’ve lost several since the beginning of the year that I wouldn’t have if I had the cash to close immediately. They would have both been great investments.
I don’t understand how to structure a deal with another investor so we can both win. Help!
There would be private lenders or hard money lenders; who can do a blanket loan; as a fixed DEBT funding; as a loan on the property.
Some people go for EQUITY funding with private lenders. You have to structure carefully with detailed terms and scope of each person role. As you know there are profit/loss/ maintanence/vacanies to written out as well. Draft and handle who is familier with real estate laws in your area.
If you getting loan from lenders as pure DEBT; then provide them title policy through title company. Have title company to record mortgage and sign mortgage note during that time. When you go for
The appreciation in DEBT funding goes to you; but in EQUITY funding you have on detail how that is going to be handled.
Specialist · San Antonio, TX · Member since 2015 · 909 posts · 297 votes
7y
you will usually split a 50/50 equity deal for newbie investors but as you build your portfolio and experience you can start to weigh that more on your side. go to networking events and look for private money or if you qualify go with agency debt or some other loan product first