No money down on a flip!

[Luc Boiron]

I've been reading a lot of posts on BP, and it suddenly clicked that a deal I recently put together was done with NO money down!

One of my best friends was moving out of the country to study in Asia. He has a few properties here, and we have invested together on rentals in the past, so there is a lot of trust between us.

He wasn't sure whether to keep it rented out or to sell it, and told me that he was going to list it, and if it sold for the right price, he would sell. The right price for him was too high for me. However, we were chatting about my flips and I mentioned to him that one of the "tools" in my toolbox would be to ask a seller to hold onto the property until it is renovated, and then sell it for me. This would seriously cut down on the significant transfer costs we have here, such as legal fees, land transfer tax, mortgage discharge and interest/fees to private lenders. 

I mentioned how I could make it a win/win by not needing to pay these fees and getting a little bit of a lower price than the full retail, and how the seller would get a little bit lower than retail but save more than that on Realtor commissions, so they would also come out ahead. My friend asked me "Are you interested in doing this with my property?".

After running the numbers, we agreed on a price. This property is in Toronto, Ontario, Canada.

We drew up a contract, and I took over the payments on the HOA fees, his mortgage, and utilities.

I now own the rights to the property, and didn't need to put a penny down. I now just need to fund the renovation, sell it, and should make a small profit. On top of that, I was able to help a good friend!

So there it is! I used to struggle with telling friends and acquaintances that I was flipping, but I try to make sure to get the word out there. You never know where your next deal will come from!

And now everyone - get out there and find another deal!