Purchasing a multi property RE Portfolio with little cash available

[Blake Ziegler]

BP Members,

I'm looking to dive in to real estate investing and came across an interesting portfolio that is being liquidated. The portfolio consists of 6 SFH's and 1 Duplex. All of the utilities are being paid in full at all properties with the exception of 3 units where the owner is paying water/trash/sewer and 1 owners meter electric bill. All the properties have been rehabbed with in the last 3 years. It is currently managed by a local PM company and the current owner is very satisfied with their performance.

The properties are located within 40 minutes of where I live and I would continue to use the current PM company if all goes well. The PM company deals with collections, repairs, evictions, etc.  The vacancy rate is currently under 10%.

The responsibilities of the current owners is just paying the bills.

I am looking for creative ways to acquire this portfolio but have little cash funds available because I just purchased my personal home 4 months ago on an 20% down, 15yr fixed mortgage.

Here are the numbers on the portfolio:

• Gross Rent: $65,000
• Annual Operating Expenses: $26,750
  
  • Management Fee: 10% of collections
  • Annual maintenance: ~$3,500
  • Annual Operations: ~$3,750
  • Annual Taxed/Ins: ~$13,500
• NOI before reserves and Debt svc: $35,000

The current owner is liquidating the portfolio to pay for a child's college. Asking price is $275,000.

Now for the financing ideas:

• I don't have  anywhere close to the 25% down that a typical investment loan requires.
• Will a bank view this as a "company" loan and see that it is making money and the management of the portfolio isn't going to change?  Only change of ownership will change.  If so, how do I go about asking for that type of loan.
• Seller financing is an option but doubtful because the owner wants out.  Maybe the properties could be acquired one at a time as they to pay for the college bills.
• What about hard money lender, still kinda new to that. 
• Find a partner to put the down money and then buy them out as it cash flows.

• Or is this just a bad idea and doesn't cash flow enough to make it worth it?