Million Dollar First Deal – Am I Crazy?

[Josh Oshier]

Hello BiggerPockets community! Newbie here, been hunting my first deal. Recently an opportunity popped up to buy a “package” of 8 4-plexs (32 units total). The sellers are asking just under a million. I don’t have the money to put a big down payment on this thing, and based on their numbers I think I’d have to get it closer to 700k for it to cash flow properly (almost $100 per door at 700k and 100% financed).

They may be willing to seller finance 10%. If I could find a commercial lender that can do 90% LTV with a 30 year term could something like this be purchased with no money down if the seller carries the 10%?

The deal is out of state. My dad lives nearby though and is interested in real estate as well so he would be my boots on the ground.

Here are their numbers:

• Rent: 14,250.00 month
• Taxes: 15,300 year
• Insurance: 6,800 year
• Management: 8%
• Maintenance: 13,000 year
• Utilities: 3,600 year (they say tenant pays utilities so not sure what this is)
• Lawn: 900 year
• Pest Control: 600 year
• Legal: 600 year
• Vacancy: 10%
• I also assumed 5% for Cap Ex… not sure if that is a good number?

How do I go about verifying these numbers they are giving are accurate? Am I forgetting to consider anything? Is this too big for a newbie?

Sorry for the long post and thanks for any help!

TL;DR

I am thinking of buying 8 4-plexs for my first deal. Am I crazy?