Anyone been able to buy CRE with the owner’s cash plus a little extra ?
So I was thinking on possibly talking to the property owner of an industrial CRE. And I learned a creative way to fund the down payment for it. The owner himself. I’m sure someone has come up with this already but hear me out. (There’s a little bit of math here)

Say the warehouse is $600k asking price. So a 15% down payment would be 90k (that I don’t have). So I would talk to the owner and say something like “Hey John, I’d like to help both of us. Id like for you to let me borrow $107,647 and sell me that warehouse for $717,647. You would allow me to put the 15% down required by the lender, and for investing in me to purchase it at that new price, you’d make an extra 10k cash ($717,647 - $107,647 = $610k) “ 


I get to buy the property even tho I don’t originally have the funds for it, and in turn, give my sponsor/owner the extra 10k for helping me get the property.

If this has occurred to anyone and have been able to go through with it, please share your story and whether it was worth it. It would motivate me so much to go out and hunt a worthwhile CRE as of today with this as my only possible strategy for purchase. I’m trying to get as creative as I can to quit my job and focus all time and energy on what I love (CRE).
[{"id": "gpdh00u", "text": "Creative but this is pie in the sky and I think you'd need to offer a lot more incentive for a property owner to participate in a structure like that, and I doubt a lender would consider it but maybe..\n\nInstead, look up seller financing or owner carry financing. Instead of a loan, the property owner carries the note and acts as the bank-- and if you default on payments, keeps the property. Essentially a rent to own scheme at higher interest rates, gives you equity and ability to secure a loan down the line, pay off balance of today's agreed upon property price in the future.", "replies": [{"id": "gpdhuwt", "text": "I\u2019ll look into it. I\u2019m looking for any creative way I can take on a property. Thanks for the feedback", "replies": [], "depth": 2}], "depth": 1}, {"id": "gpdhqjh", "text": "https://youtu.be/WgMPYL63wNc\n\nIf it\u2019s vacant and you have a tenant, maybe. Otherwise you need money. Owner financing has plenty of other strengths but you can\u2019t just paper your way like you described. Bring a real deal and post, I\u2019ll buy it and let you in for experience. $600 is really small TBH", "replies": [{"id": "gpdi6yp", "text": "Wait what?!? Okay Maybe I\u2019m miss-reading something... You would consider partnering with me ?", "replies": [{"id": "gpdif7v", "text": "He can't lose if you have a credit  tenant in hand.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "gpdjb4s", "text": "Yeah if the property is worth $600k and you buy it for $717k it likely won\u2019t appraise for that higher amount. Also no way a first time commercial buyer that is essentially getting a loan for the down payment and has no liquidity is getting anywhere close to as high as an 85% LTV loan on a warehouse. \n\nAs the other comment mentioned, try seller financing maybe. \n\nCRE is a capital intensive business. Capital expenditures like roofs and HVAC, or tenant improvements for a new tenant, etc all cost money. If you don\u2019t have enough money for a 15% down payment then honestly I would say you\u2019re going to need to save a lot more to come up with a reasonable down payment and have some reserves/cushion for things that will come up when you own a property. \n\nYou can\u2019t just roll up with zero capital and essentially put 0% down on a loan and start making money off CRE. If you could everyone would do it.", "replies": [], "depth": 1}, {"id": "gpdjzhr", "text": "&gt; I get to buy the property even tho I don\u2019t originally have the funds for it \n\nWon't really work for the first time", "replies": [], "depth": 1}, {"id": "gpdkiez", "text": "So the bank is going to loan you $610k on a property worth $600k? Sounds like you have everything worked out. Don\u2019t forget to charge the seller an acquisition fee as well.", "replies": [{"id": "gpdkyiv", "text": "No, for $717,647. Which would give the seller an extra 10k for letting me borrow money. Which is where the 610k came from. As for the fee. I\u2019d charge the seller a presence at the nearest bar, where we can enjoy a good whiskey for a successful transaction then carry on with our lives. Nothing much.", "replies": [{"id": "gpdl5ch", "text": "You\u2019re missing the point. If the property is worth $600k, why would the bank give you a loan for $610k?", "replies": [], "depth": 3}], "depth": 2}, {"id": "gq5d7te", "text": "&gt; Don\u2019t forget to charge the seller an acquisition fee as well.\n\nI almost spit my drink out. That was a good one.", "replies": [], "depth": 2}], "depth": 1}, {"id": "gpe23gd", "text": "Industrial loan amounts are also determined by DSCR/DCR and debt yield so you\u2019ll need to inflate those two components as well if your scheme has any chance of success.", "replies": [], "depth": 1}, {"id": "gpfnse9", "text": "Theme song: [https://www.youtube.com/watch?v=wTP2RUD\\_cL0](https://www.youtube.com/watch?v=wTP2RUD_cL0)", "replies": [], "depth": 1}, {"id": "gptwv3b", "text": "Anything is possible, but it\u2019s improbable that you\u2019ll paper into a deal like that. Suppose you did, the debt services would be greater than your rev.", "replies": [], "depth": 1}]