Private Equity Books

[Brandon Roberts]

Hey guys! Just recently purchased my first two properties with conventional 15-yr mortgages. This of course maxed out my debt to income ratio, making it very hard for me to get another conventional loan this year. My goal is to buy three more properties by the end of 2018 by using my parents as private equity lenders since they have a decent amount of cash saved up (over 100k) and are willing to lend me some of the money. Do you have any advice on different strategies about putting a deal like this together or could you recommend any good books/articles to read before I jump into this adventure? 

Thanks in advance for your help!

[Account Closed]

Hi Brandon Roberts

I’ve had to navigate these strategies myself. Do your relatives want to be equity partners or just the lenders? I would sit down and find out what their goals are exactly and then you can position your strategy accordingly. Being equity partners or being a private lender has its advantages and disadvantages.

A previous commenter suggested commercial properties, I fully support this. 30 Year / Fixed Rate is appealing yes, but it is difficult to scale. That smaller end apartment building is a great way to learn on the job and build confidence with commercial lender.

One option that comes to mind is finding a 6 unit property (ideally one of those buildings that is actually 2 triple-deckers w/ basements with a combined stairwell). You’ll find these have identical layouts, making it very easy to renovate, easy for maintenance, and the basement can become storage and laundry for extra income.

I would be happy to PM to talk more in-depth if you like!