The Creative Financing Podcast
Business:Investing
In this series we continue the Pop Quiz from Jeff and turn the focus to deal structuring. We apply creative financing principles to deal structuring using real life examples. We cover the following:
Determine your buyer- Who are my Buyers: Flippers, Landlord, Owner Occ, Retail Buyer (on Market)
High purchase price, Down payment, monthly payment, Low equity- Owner Occupant.
Owner occ- term to be 3yrs minimum.
Get in light- 5-7%. Not a hard number. We need 30days to find a buyer.
What would be a good monthly payment for a property, affordably. Would it make sense as a rental? Median price range of rents.
What's enough equity to have to make it a deal work- price is the least important criteria when using creative financing, down payment and monthly payment are the most important.
How much can you raise the price when selling on terms? Within reason. Does the condition justify the price? 10-20K above market value
How to determine length of term- depends on your exit strategy and who your end-buyer is. Also how long of a term works for the Seller, and what is their goal with the proceeds.
How much can you offer when selling to a Landlord
What's too much for repairs? Depends on down payment and who's your buyer. But cash on cash returns for a landlord needs to be 12% min. That's the all in cash required for down payment, repairs, closing etc. Equation equals cash flow x 12 divide all in cash = cash on cash return. Return needs to be a minimum of 12%. Unless, however, the landlord can do a cash out refinance after repairs and stabilizing, therefore lowering the out of pocket cash requirement.
How much of a ARV discount should we try to get from a landlord? Look for value add, or equity. Cash on Cash return. Also, least important is cap rate.
When do we shorten the amortization schedule? To make a payment work in our favor. More so for principal paydown.
Hope you enjoy, And to get special access to a step by step video on how to structure creative financing offers, text CFP to our hotline at 877-409-8090 or click HERE.
Ep 143 Pt.4 Pop Quiz Time- How Much Do You Know About Creative Financing
Ep 142 Pt.3 Pop Quiz Time- How Much Do You Know About Creative Financing
Ep 141 Pt.2 Pop Quiz Time- How Much Do You Know About Creative Financing
Ep 140 Pt.1 Pop Quiz Time- How Much Do You Know About Creative Financing
Ep139 Simple Deal Structuring, You Can Do It Too
Ep 138 Pt. 2 It's All About Negociation
Ep 137 Pt.1 It's All About Negociation
Ep 136 Commercial Deal Structuring On Storage Units
Ep 135 Some Key Points On Virtual Wholesaling
Ep 134 How To Deal With Pushback From A Seller.
Ep 133 How To Make Deals Work On A Slim Margin
Ep 132 Pt.2 Dodd-Frank And What You Need To Know To Protect Yourself When Creating Terms
Ep 131 Pt.1 Dodd-Frank And What You Need To Know To Protect Yourself When Creating Terms
Ep 130 Pt. 4 Offer Structuring On An Overpriced 8 plex
Ep 129 Pt.3- Offer Structuring On An Overpriced 8 plex
Ep 128 Pt.2- Offer Structuring On An Overpriced 8 plex
Ep 127 Pt. 1- Offer Structuring On An Overpriced 8 plex.
Ep 126 Is This A Deal- Keys To Making A Deal Work
Ep 125 Blow Out The Competition By Offering More And Making More
Ep 124 How To Create Terms Around An Existing Lease- A Hybrid Approach
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