Creative Financing Options for Small Multifamily and STR

[Mason Haley]

Hello, I have been building my real estate knowledge and networking for the past year. I am graduating college and will have a high income job as a dentist with a strong debt to income ratio. However, my funds are quite low at the moment and I cannot afford a conventional mortgage for investment.  I really want to get started in real estate and want to scale quickly by finding a small multifamily and a short term in the near future. Are there any suggestions for creative financing to allow me to get started earlier? 

I have heard of vacation home as a way to get into the short term rental space? Recommendations, how does this work? 

Small Multifamily options? I have heard of seller financing which sounds wonderful but what if the seller is not open to that and it is a great deal? Debt vs. Equity partnerships?

Any Tips or suggestions are appreciated. Thank you! 

[Kevin Sobilo]

Do a house hack and live in your investment. Buy a 2-4 unit using an FHA or low down payment conventional loan (~5%) and live in one of the units for 1 year. After that you can move and rent out the additional unit if you want.

With the market so hot, seller financing hasn't been an option that sellers have been open to. Perhaps in another year if interest rates are much higher and buyers dry up that could change.

If you find a landlord who is in distress, you could possibly do a "subject to" deal where the owner has you take over the loan without the loan actually going into your name, but you really would need to find a landlord who NEEDS to sell but can't. Maybe they owe a little too much. Even if you're assuming more debt than the property is worth as long as it cash flows it could work.