This keeps your cash out of the deal and pops your ROE, IRR, or any other metric you use as a hurdle rate for the project.Buying subject-to generally ups your purchase price above what it would be with an all-cash offer so all of the scenarios need to be modeled for each type of transaction to see which one makes the most sense.

Even a different model of the same brand can make a difference.

I like this model because I know the properties in my back yard, I drive by them every day.

For example, a 2012 model will lose a ton of value by 2013 or 2014, but an early 2000 car isn't going to seem much older in a couple more years after today.

It occurred to me if this was a reasonable business model we could mortgage the house, lend out the proceeds and make what, 7-12% on that?

I've owned 3 properties - 1 foreclosure - 1 extensive rehab - 1 new construction (model) I picked up.

Its crazy I know but its how he makes his money and he's real good at what he does, he mostly works with models , Artist , DJ's, restaurants , etc that are trying to get their name out more and exposed.

(1 bed, 575 square feet, basement model.)

Explain all the other variables and that it's because you're new (nothing wrong with that as long as you're analytical) you want to stay safe and conservative in all your estimates and are uncomfortable operating on razor-thin margins - all these things justify your offer.If you think of yourself as someone unwilling to compromise your integrity or business model, there won't be any hard personal feelings whichever way this deal goes.

.), how quickly and in what fashion you want to receive cash, whether you'll ever take on new partners or investors, and about twenty other important questions.Any organization that always advocates one company model over another almost certainly only really understands that first company model.