How Should I Acquire?

Question

I am looking to buy a property in Phoenix, AZ for my son to live in. At first I was going to purchase a cheap 1 bed condo for less than $50k. However, I've decided I want to purchase a duplex or triplex creatively.

My credit union has offered to increase my credit card limit to $44k. I was thinking about using $20-25k as a down payment which still leaves some money for working capital. Apart from using my credit card, what creative ways could I acquire a property? I do have cash funds from other resources, but I want to acquire using OPM.

Ideas?

Jackie Jones · Answer

Hi David

Yes.  That helps a lot.  Thank you!

David Dey · Answer

The cool thing about buying a multi family property, whether a duplex or bigger, you are dealing with an investor.  This means that there is room to negotiate and they are already predisposed to negotiating and deal making.

The first and most beneficial source of OPM is your seller.  See if they would be willing to accept any of their purchase price in payments.  (Sounds less aggressive than owner financing)

This way you can get much better terms than private money and much less headache than a bank.  (Hint, if they don't bring up interest rates.. Neither do I.  How does a 0%interest rate sound to you?)

You can always use a blended interest rate scenario getting a first mtg of 20% to 70% from a private lender, and have the seller carry back the balance in a second.  I have been able to work many "no money down" deals with this scenario and the blended interest rate helps cover the higher cost of the private money.  (Ex:  100k purchase price, 50k first to private lender at 10%, 50k second to seller at 0% = no money down and a 5% blended interest rate)

Hope this helps