'Fixer Upper' Financing Strategy?
So I'm sure we're all familiar with the hugely popular Fixer Upper show and what the Gaines family has accomplished. My question is regarding how one might go about structuring such a deal? Here is the situation I'm faced with that replicates the way the Gaines operate their business:
- I bought a fixer with cash and have buyers interested in working with me through the rehab.
- We want to bring them along, give them a seat at the table, and ensure we utilize a floor plan and finishes that are exactly what they want in their future home. Who wouldn't want a buyer waiting in the wings, right?!
So, how do we structure such a deal to ensure buyers have some skin in the game? Would it make sense to structure a purchase contract with a large down payment and extended closing date? Do we establish a purchase price now when we haven't even started demolition? How do we protect both parties while ensuring there are methods to handle risks and unknowns? How is this question different if we're talking a cash purchase versus financing?