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Pretty easy to see how this'll turn out: Some moderatley rich person with access to a 10% down payment of 3.2M is taking a gamble and is in way over their head.
by drcode 12y ago
Pretty easy to see how this'll turn out: Some moderatley rich person with access to a 10% down payment of 3.2M is taking a gamble and is in way over their head...
Just wait, within a year they will lose ownership of all these properties in bankruptcy and they'll be back in the hands of the city.
- DanBlake 12y agoLoans dont work that way in 2014. There is no bank in their right mind who would grant a loan to buy this, even at 90% down. The 2007/8 crash changed how banks and loans operate. If anyone lent any money, it would be private investment- But those guys generally dont fuck around for sub 10mm deal size. This is one dude using his own/biz's money/
- swalsh 12y agoI'm guessing you've never actually gone through the process of getting a mortgage?
- couchdive 12y agoAlmost all public auctions I know of do not allow loans at all. You usually need a cash downpayment to even bid, and proof of funds in bank to participate.
- breitling 12y agoReal estate investor here. The buyer probably paid all cash...these sort of deals require that you pay cash, so very unlikely that they leveraged against these properties. However, they will likely have raised capital with some other portfolio of properties as collateral. So not all of this is coming from his savings. I see others talk about how difficult it is to get a mortgage, etc. Let me just say from personal experience that it is not difficult to get a business loan (which is what this buyer will need, not a "mortgage"). Especially if he already has an established business.
- drcode 12y agoOK, for some reason all the replies to this post feel it's really important what percentage of the capital the person is personally putting in. That seems kind of besides the point of my argument.