Need help structuring deal

3 Replies

Hey to all fellow BP members. I wanted to ask for help in structuring my first deal. I have a deal in Staten island new York. This is for a 2 unit MF property that will need rehab. I wish to purchase this property to use the BRRR Strategy. I spoke to the owner and we agreed on a price of 265k. I have the down payment and have the Rehab money as well. My problem is that my credit is no good and i have the money in cash. Since this is my first deal i am inexperienced with the financing side of investing and don't want this to keep delaying me from starting my journey as an investor. I am reaching out to my bigger pockets fam to see if any one can guide me to the best solution to my obstacle, I am so excited and prepared for this journey and I would not like to loose my opportunity at this deal.

Originally posted by @Jankely Hidalgo :

Hey to all fellow BP members. I wanted to ask for help in structuring my first deal. I have a deal in Staten island new York. This is for a 2 unit MF property that will need rehab. I wish to purchase this property to use the BRRR Strategy. I spoke to the owner and we agreed on a price of 265k. I have the down payment and have the Rehab money as well. My problem is that my credit is no good and i have the money in cash. Since this is my first deal i am inexperienced with the financing side of investing and don't want this to keep delaying me from starting my journey as an investor. I am reaching out to my bigger pockets fam to see if any one can guide me to the best solution to my obstacle, I am so excited and prepared for this journey and I would not like to loose my opportunity at this deal.

 Jankely

This post has pros, cons and fortunately a solution.

Pros

If you have the money for down payment (probably 20%) and rehab (depends on the scope of work), you should be able to find a hard money lender for the purchase and rehab.  

Con

If your credit is no good, you will not be able to find end financing to make this a hold project.  

Solution

Either find a jv partner or just rehab it, pay off any debt with the proceeds from the sale and do it over and over again until you've put enough time between your poor credit choices and your ability to borrow.

That's how it's done.

Stephanie

Thank you Stephanie for your response. Those were the two solutions i came up with as well. I would be having trouble with my exit strategy in this case. Best thing i can do is find a partner with great credit and use him as the sole credit applicant. Thank you i will make sure to not let this delay me any more.

HI, I think you should buy it and flip it. If you have a least 25% down you could find private money, You should flip a few properties first, Do you know how much are you going to spend on repairs, holding the loan and ARV?

You need to increase you investment capital until you repair you credit, good luck

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