​willing to pay extra for no money down or creative finance deals

[Daniel Perez]

Are you willing to pay extra for no money down or creative finance deals?

Dear Group Members, thank you in advance for your valuable feedback on this matter. I’m currently looking to purchase a property at a 6% cap rate where I know we paying extra. ( 2% cap extra) the property for us and market value has a value of an 8-8.5 cap rate. However, the seller won’t budge on price but agreed to do a seller finance on the second note for 10%. With this being said, we only need the 15% to acquire this property.

The ROI is good but the downside is the extra premium we paying to get the deal. No appreciation! But good cash flow.

What are your thoughts? Thank you in advance! 

[Joseph Gozlan]

at the end of the day it doesn't really matter wher you get the second note from. If your bank would do 85% financing at that price point would you buy it?

I have seen people overpay just because it was "creative" and I've seen people walk away from good deals as well. 

Disconnect your own emotions and preconceptions and use math to guide your decision. 

At the end of the day when you load up all the debt stack, will this be a good investment? Is the risk/reward ratio acceptable to you and/or your investors?Does it fit within your long term goals and strategy?

If the answer to all these questions  is yes, go for it.