Hey guys, first post on the forum. I'm interested in making an offer on a property, though I'm not exactly sure how best to structure the deal. I figure maybe I can lay out some of the deal highlights and perhaps you guys could give me some insight.
Asking price is $1mm. I plan on offering $850.
The property is a mixed-use building in NJ. There are two office units, and two apartments.
Monthly cashflow is about $9,750 with substantial upside if managed correctly.
The current owner purchased the property around 2014 for $800K. They currently have a mortgage with about a $500K balance remaining.
I've asked about assuming their loan. So far, the broker (representing both sides) has said the bank, which is local, would be open to transferring the mortgage over.
I guess my question is really how to structure the balance of my $850k offer. Meaning, I'll assume the $500k from their current mortgage which will leave a funding gap of $350k. I'm debating asking the seller to finance some or all of that amount, I'm considering additional loans, maybe short term hard money with a refinance down the line, although that feels a little risky for my taste. Basically, I'd like to put in as little money as possible and I'm trying to think about different ways to make a reasonable offer to the sellers.
Have any of you guys been in a similar situation? What are some ways to approach this?
By the way, I appreciate some might consider this overpriced.
Sal - It appears you have no cash to put into the deal. Is that correct? Or do you have other assets to leverage?
It may be worth a discussion anyway. - Joe
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