Hello, hello, hello, it’s Neil from Clever Property Investing on this rainy, dark, damp day, but let’s see, the sunshine will come through later on this afternoon. Today, I want to talk about the deal I’ve been mentioning over the last few videos that’s actually now completed and I now own a semi-commercial property. It is by all means and could have been a very, very low money down deal.
It would not have been a no money down deal because there’s always gonna be fees such as solicitor’s fees and surveys and things like that and you will have some fees and I don’t think that you’re ever gonna get a situation where there’s no money down. There is always situations where you can recover that money, that’s through refinancing or increasing the value of the property. But let me tell you about this particular deal.
This particular deal is a flat, a blurb, a shop. I have purchased it now, I have the keys and I have workmen in there already doing some works on the commercial unit and it really was a purchase price of 250,000 pounds. The owner only wanted 160,000 pounds right now at this moment.
So we had a little chat about how much she could live without and whether she could lend me back the difference towards the purchase. So that meant that she was gonna lend me 90,000 pounds which is brilliant. So there was gonna be a lending of 160 and a lending from the lender, the mortgage lender, 160 and then from her 90.
However, the mortgage company didn’t like that. They didn’t like the fact that I wasn’t putting any of my own money into it so they asked for a 10% contribution for myself. So they reduced the loan amount that she was gonna get by 25,000 pounds which meant I had to find 25,000 pounds.
Now I managed to find the 25,000 pounds from an investor. So basically some angel money. Somebody wanted to put some money into the deal and then they wanted to have interest as well.
So of course the seller’s getting interest on her 90,000. The mortgage company’s getting interest on the money they’re lending and the investor’s getting money on what they’re lending. I had to put in the extra money for stamp duty solicitors and for surveys.
So all in all it’s a very low money deal and actually the money and the interest I’m paying for the investor and for the vendor is less than the mortgage amount. So actually I’m paying out less overall. Little bit tricky, can be a little bit, if you’re not good at managing and organizing these things it can be a bit tricky but basically it’s there, it’s possible.
Lenders are open to it at the moment and so I would say just go out there and get those deals, find these deals, see what you can do and you’ll build your portfolio. You’ll generate cash and cashflow on that deal every month plus the value of the property will go up. Now the deal I’ve struck with the seller, vendor is a five year deal so I’ve guaranteed to pay her back the money in five years time.
So that’s a great deal for me on this wonderful wet, damp morning and I’m very happy that this is gonna go forward and I wanna do more of these. If you wanna learn how to do that or you want help or mentoring or coaching doing this kind of thing, get in touch, let’s have a chat, see if I can help you.