Equity Share Owner

[Ryan Carroll]

Hello BiggerPockets Fam,

I am curious if anyone has information on this specific strategy used to buy property with no money down. It is called equity share owner, which to my understanding works like this. 

"The owner transfers title to an

entity in which the two of you are partners. The property if refinanced for the

purchase price. The owner gets out as much of his equity as he can, and

becomes an equity partner for the rest.

For example, an owner has a property he is selling to you for $1,000,000. His

current mortgage amount is $650,000. He transfers title, and the property is

refinanced for $800,000. He gets $150,000 of his equity and he becomes and

equity partner for the remaining $200,000.

The benefit to the owner is that he gets 20% of the monthly cash flow, plus his

20% equity stake will be worth more when the property appreciates."

I am looking to buy my fist rental property but don't have enough money for the downpayment and I don't want to mess with any lenders and interest rates. 

Just curious if to anyone has used this method before in buying a property by partnering up with the owner. And if so, did you have to put a big downpayment down on the property still? Or is this really a way of buying a property with no money down?

Thank you, 

Ryan