Oct
03

How Much Should You ‘Give Up’ in exchange for someone who puts up the down payment on a deal?

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2 Day Work Shop on Advanced Deal Structuring W/ George Antone

Lesson 2:
 
As you know, master financier and mega private money lender George Antone will be back in Greenville teaching some very exciting strategies on higher-margin, lower-risk investing strategies to guide us to our desired result.
 
Here’s another lesson he’ll be expanding on when he comes:
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How Much Should You ‘Give Up’ in exchange for someone who puts up the down payment on a deal?
 
ANSWER: The best formula is not to use debt for the down-payment at all, as your returns drastically and exponentially go up and your risk exponentially drops.
 
BUT…If you do or you must:
 
Step 1: Calculate your cash-on-cash return for the down payment amount
Step 2: For Equity financing, give up 50% or less
Step 3: For debt financing, borrow money at a lower rate (preferbally 50% or less) than the cash-on-cash return.
 
Many investors make the critical mistake of not calculating the effect the down payment has on a deal. It can be staggering, and it can make or break you.
 
Problem is, you may not feel the affects of it until a few years down the road, when you’r scratching your head trying to figure out what went wrong.
 
Don’t follow in the footsteps that many investors unknowingly make because they don’t run these numbers.  Be precise and KNOW EXACTLY what the best rout for structuring the money in a deal.
 
George Antone will be here in Greenville, SC  on October 21 & 22 for 2 full days of training. Read more at; http://UpstateCREIA.com/george
 
See you there!
 
Norm Reid
Investor & President, UpstateCREIA

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