Creative Financing

[Justin Green]

Question for the BP forum? What do you do when you are tapped out of liquid cast to jump on a deal? This is for general knowledge and also evaluating my situation question. Say you have a seller that wants out completely ie No seller finance. You want to jump on the deal, get the seller their funds and have capital for rehab. This is for buy and hold. Obvious choices aside, Hard/Private money, Seller Carry, wholesale, contract carry, Investor cash...

What are some of the most creative deals you guys have pulled off?

[Brian Gibbons]

JV Partner with a doctor

Ex 

$100K ARV needs $20K

Offer .65 x 100K - $20K = $45K

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Start LLC with Doctor - Go to Sercretary State's Website

Operator Agreement 2 Party LLC download

see attorney

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Say to Doc

"Doc, I have a business propostion for you.

"I find a steal of a re investment, needs work, say after repaired value = $100K, needs $20K, I get it for $45K.

"You and partner up, You buy it and put up the $20K, you have $45 + $20K = $65 K into it.

"You and I sign a LLC partnership agreement. After we sell it, you get all your money back, All $65K, and pay the costs to sell.

"Say it goes like this:

"Costs to Acquire - $45K 

"Costs to Fix - $20K

"Costs to Sell for $100K - agents commission, closing coasts, holding costs = $10K

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"$75,000

"Net $25,000

"You get your $65,000 costs back plus 50% of gross profit $25,000 or plus $12,500.

"Annual % profit -    $12,500 div $65,000 = 19.2% annually

"For 3 months = 19.2 x 4 = 76.8 % annual

"We can do 4 of those a year.

"What do you think Doc?

And by the way, Doc, you can use your IRA money, and if you set up a Roth IRA, you never pay tax on the profit, EVER."

@Dmitriy Fomichenko 

if you could say a few words about SDIRAs and JV Partnering.