The Double Simultaneous Close...Is This Legal? - Posted by Janine Peterson

Posted by Janine Peterson on August 14, 1999 at 15:55:38:

Question for all experienced “flippers”:

I have been approached by three partners looking to purchase 2 multi unit rentals (one 8 units, one 5 units) with NO MONEY out of their pocket, not even closing costs. If I could find a lender who is willing to do 70/30 or 80/20 with seller to cover all closing costs; then there’s no problem here, but I don’t know of any willing to do this on multi unit rental investment properties. If any of you have a suggestion, please advise…

But, they approached me wanting to do 2 closings; one from the original seller to them, as an “all cash” offer, and one from one of them to another with owner financing to sell the note for cash and pay the owner. I have done these before, and from what I know they are legal, but normally end buyer has to put up 5% down payment, and they don’t want to do that. Is there a notebuyer that would buy this note with no money into the deal or no down payment if there were compensating factors, like good credit history, other assets, possible blanket lien on personal residence, or sale below market value, ANY SUGGESTIONS FOR NOTE BUYERS WHO WOULD CONSIDER THIS TYPE OF DEAL? OR IF THE ORIGINAL SELLER IS WILLING, COULD THE SAME DEAL BE STRUCTURED FROM THE SELLER TO THE PARTNERS WITH AN OWNER FINANCED NOTE, AND SELLER 2ND, NO MONEY DOWN? Possible blanket performance lien or 3rd mtg for down money.

I just want to avois a situation where they are staing that down money has been paid if it hasn’t.