Multi-unit: No Money Down

One of the key things that we believe will lead us to long term success is relationships. A key relationship helped us acquire our first multi-unit property, and with no money down. Before we got started in real estate, one of the thing that we wanted to do is get to know some people locally that were currently investing. Through one of these people we came across a lending opportunity. We helped fund the rehab of a 3-unit that an experienced investor had already purchased the property. We got 12% for 12 months. It was a good return, however, what we really wanted to do was gain the experience. We were paid back with interest and went on our way.

A couple years later we saw that property pop on the MLS. It was offered on a land contract at a 17% cap rate. We called the investor immediately. Even with our quick response time we weren’t the first to reach out with an offer. The seller had mentioned that she had received a better response than she had expected. We made our offer and it was accepted. The key to this offer getting accepted was that we had a relationship with the seller and the seller had confidence in our ability to pay.

With the purchase covered by a land contract, the only thing that we had to come up with was a down payment. We had our cash tied up in another property that we were flipping but we didn’t want to miss out on the opportunity. So, we offered a lending opportunity to a friend that is interested in real estate. He put up the down payment and will get paid back with interest and will most like reinvest.