Need advice on first potential deal - Posted by Focus

Posted by Focus on May 09, 2001 at 18:59:19:

Thanks for your advice.


Need advice on first potential deal - Posted by Focus

Posted by Focus on May 09, 2001 at 12:48:49:

Hi, everyone. I’m a newbie in REI and I’m new to this site, too. But I have been reading almost everything on this site. I have gone through CS a couple of times and I have CS Success Series.

I have come across some potential deal and I would like you guys to confirm or kill my excitement.

Investor is selling 17 units in a larger rental building for $680,000 (10 of them are one bedrooms). They are owned free and clear. Net operating income: $44,000, all units currently rented. Location is great, too. Seller is willing to carry a 10% second (no interest rate discussed yet) and help me get a first for about 80% LTV if my credit is good (which it is). He also says he could lease-option to me for renewable 3 months terms, with $10,000 initial L.O consideration fee. He’s also not excluding 5% down if nothing else, although he is very reluctant to do that. I don’t know why he is selling but he sounded motivated enough for me. The units were already for sale in January this year.


  1. Supposing the price is right, title is clear and his numbers are correct, how would you structure your offer?

  2. What do I need to check, other than his numbers, before I get in the deal?

  3. Is the fact that the units are part of a larger building a problem?

I’m asking obvious questions because I’m all new to this. This would be my first deal.

Any input would be greatly appreciated.


P.S: I live in Maryland if that helps anything.

Re: Need advice on first potential deal - Posted by john

Posted by john on May 09, 2001 at 15:21:52:

sounds a little to ambitious to me for starting out trying to learn the system…personally Id start with a duplex or quad to learn the system…then fry bigger fish!