All Forum Posts by: Omar Ruiz

If you're buying with leverage, you absolutely need to know what your cash on cashflows return is - no exception. If you're buying all cash than the cap rate is most important.

You can try a couple of things.

1. Show him proof of funds, so that he knows you can do the deal, and than you get the financials. *Note* he may just want to know that you can perform and not wasting his time.
2. Put a small refundable deposit in an escrow account ($10-$100), with the requirement for the seller to provide financial statements and disclaimer that it will get credited towards earnest money deposit after a purchase contract is signed within a specified number of days; otherwise, you receive your money back. 
3. Have him tell you over the phone what the units rent for and the vacancy and let him know that you'll base your offer on a 60% expense ratio, until you get documented information to the contrary. 
4. Followup in a couple weeks and ask for the financials again, and keep following up over time.
5. Let him  know your interested but you don't do business like that and you work with people that have integrity and walk away. 

Good Luck!

you need to talk to as many commercial loans brokers as you can, asap before someone else gets the deal.

Search for commercial brokers to send you deals.

if you have 47 units you should meet the networth requirement. You should be talking to hard money instead of banks. Banks are creative enough for what you want to do. When I  did my first deal I talked to everyone hard money and financing option available, and it was way more than 4 banks. 

if you want to limit liability just get more insurance. It's typical not recommended to buy small property with llc due to the cost. Hard money may do it but for about 3 years and then you have to refi.

whats the price?

What's the noi?

what is the cap rate?

Whats the unit mix?

What class of building? 

What class neighborhood? 

What age?

Request p&l for at least one year.

Good luck 

You can read my due diligence article that is on my blog at LERU Investments. The article references my experience performing duediligence from single family to 170 unit apartment complex. 

To Your Success! 

you're forgetting the insurance. 

At minimum get the 12 month profit & loss statement and a rent roll to calculate an offer. Once you have it under contract include the request for all the details such as receipts.