This is similar to how a traditional mortgage works when a bank requires an escrow account.

But considering we have to go with the traditional 20% down payment, we know we do not currently have the budget to get an STR that would stand out and have all the amenities that we would like to be able to offer and be in a great location.So I would like to ask for some advice from all the experienced real estate investors on BiggerPockets.Do we get in the game now?

I went through a refi last year with a traditional mortgage bank. had the same scenario, first appraisal came back super low, we argued the valuation and ultimately got nowhere. we decided to start over with a different lender, and got a 2nd appraisal exactly 16 days after the first one was dated, and the valuation was almost $80k more. sometimes starting over is all you can do. 

The key is to understand how to underwrite a syndication structured deal.GP/LP splits, acquisition fees, asset management fees, refi/sale periods..among many other things that vary when underwriting a syndication deal vs traditional purchase.Happy to share my model for underwriting these deals if you want to shoot me a DM.

In this case, we’ll use the traditional 70% rule, so 0.7 is plugged in.Formula: (ARV * 0.7) – rehabExample: ($100,000 * 0.7) = $50,000Why Is This “Rule” Critical?

However, you typically need to put down a lot of money upfront.Hard money loanCompared to a traditional mortgage, a hard money loan has a lower down payment—sometimes as low as 10% of the loan amount.

Creative FinancingFinancing can be a challenge in tough economies, but several creative strategies can make deals work: Seller Financing: Negotiate with the seller to finance part or all of the deal, reducing the need for traditional loans.

I’ve been seeing a lot of interesting deals lately, but the traditional financing methods don’t always cut it for some investors.

Antonio, my fiancée and I are both realtors, I specialize in value add property and my fiancée manages our property management company and is a traditional realtor that specializes in listing properties.  

The reason you would sell at a discount is that you need to close quickly with cash … that is the offer …  Using an agent to sell in a traditional way will not allow you to make that offer—— sounds like in Texas there are pretty hard rules on timeline… if you are in California however you are less likely to be able to say “your property will be foreclosed in x days”.