Why not set it up so that the seller pays for the rehab.
You could raise the purchase price to reflect the costs involved in fixing the property and to pay the contractor.
You can be the contractor.
So, you can pay yourself and the rehab costs from proceeds from the sale.
Whoever funds your loan may want to dedicate a portion or all of the funds and request construction draws out of an escrow account. Be sure to pay the contractor first - and make sure you have enough left over to finish the project.
I am putting a deal together and have a few questions for you.
How can I “word” the offer so that I can walk away from the table with money in my pocket?
i.e. The 4-plex is for sale for $79,900… gross rents are $20k/yr (from my calculations, cash flow is pretty good. pls advice if you don’t think so)
However, the roof will need to be replaced within the next 4 years (approx) and some other minor TLC… I’m assuming paint and other maintenance.
I’d like to walk away from this deal with money in my pocket so I can have it for the fix-ups. I want to structure it that it is an as-is sale (for the seller).
I was thinking of “gift of equity” - although I’ve closed some deals using seller credits, there’s a limit of 3-6% and usually can only be applied to NRCC. The property is in TN. I’d really like to keep it as cash flow property.