All Forum Posts by: Bob D.

My biggest issue is understanding how a 100% financed deal on a buy and hold multi family investment where 25% of the capital is borrowed at 10% and 75% is borrowed through a traditional mortgage could grow into something bigger.

With low but positive cash flow properties we would neither generate enough to pay back the principal on the private money in the short term, nor would our investors want a 30 year loan term. 

It just seems like private money is better put to use on flips and it would be helpful to see an example of a deal where investors were happy. 

Royce, thanks for your input. I understand that I'm very green in REI. We don't expect to do any of these deals soon, I'm looking to see how this investment structure works in a perfect world, and scale it down from there for our purposes.

Aaron, I think the LLC partner and buy back structure is interesting. We are also in the same market (Boston)--has this worked for you?

Everyone,

Thank you for your input. I suppose that rate of return is what we need to offer and we'll just have to find better deals. 

It seems like the best way to do it is factor in this return and pay it quarterly. 

thanks!

I think the biggest issue is that we aren't looking to flip and the buy and hold strategies down't produce enough cash flow for an attractive return. 

My partner and I have access to friends and family money to use for down payments for buy and hold properties. How can we structure a deal for an attractive return? They won't just give it to us, but we can't do deals without it.

We can get $500k, at least, and we want to use this money for as many 25% down payments as possible (looking in the 5 - 700k range for multi families).

Assume we used $125k down on a $500k three family--any creative ideas that won't eat our returns? Don't want to borrow the down payment @ 7%. 

My business partner and I are looking to do our first commercial deal (and my first RE deal). I'm a financial counselor with a background in tax and investments, and he runs his family's property management company that is capable of servicing and managing sizable commercial properties (they currently service a few fortune 500 corporate campuses in the area). He also owns a duplex in Boston that has been a home run. We could come up with money for a down payment that would involve HELOCs and rainy day funds, but we would prefer to go OPM.

Ideally we want to purchase a small commercial office building around $1m and leverage his resources.  We can manage and improve at a reduced rate.  If not an office building, perhaps a 6 - 8 unit multifamily. 

Any tips for first time commercial investors without money down, specifically in Boston suburbs? Could we do part friends and fam OPM with the rest as a mortgage? If not, could I use a HELOC as a down payment and mortgage the rest?