Rental Property Investor · Winnipeg, MB · Member since 2019 · 21 posts · 5 votes
Hello Everyone,
I have found a property and would love some guidance on how to make the deal work.
The bank will not give me a loan since I am still a student but I have enough cash reserves for 20% downpayment and rehab costs on at 250k home.
To make the deal work. A partner holds the mortgage and I pay for the closing, holding and renovation costs then pull my money out once we refinance the property. The partner will also handle the renovations.
My question:
- Is this the best way to structure the deal? (Or please let me know if you have suggestions so I am not taken advantage of and capitalize in using my funds effectively)
Goal:
- I want to build a rental portfolio and acquire deals until I graduate and find a job and finally qualify for bank lending.
Flipper/Rehabber · Pittsburgh · Member since 2018 · 6k+ posts · 5k+ votes
5y
@Karl Dela Cruz have one of your parents co-sign the mortgage with you. Then, once you have a W2 job and the value of the property has increased, refinance them off.
Investor · Jacksonville, NC · Member since 2018 · 193 posts · 107 votes
5y
Seems to be that your partner is putting up more money/risk and handling renovations. Did you find a partner to agree to this already? If not, I would consider having a "silent" partner fund the acquisition and rehab, acting as your lender, and you manage the rehab of the property, working together with the. bank, since he holds the note.
Consider maybe a private lender (friend or family) member, who you can bring the deal with a thorough analysis on your numbers and plans for the property, showing that if you had the money, you would be able to execute this project.
Then simple offer them interest on their investment, setting up similar terms of a HML/bank without actually having to go to the bank, because your partner is acting as such.