Real Estate Investing Strategy Template: Zero Down Seller Financing

Description
This is an advanced strategy than your typical real estate acquisition model. Here I've built a template for a very specific high leverage strategy. That is to use a combination of seller financing and a traditional mortgage loan from a bank (refinance) to attain 100% leverage on a purchase of a portfolio of properties.


The strategy is to buy multiple properties from a seller, using seller financing. You agree on the total purchase price and work out the terms. Then, one of the properties is given free and clear to the buyer. The buyer can then go to the bank and get that property appraised in order to refinance it based on an LTV per the appraisal value. The refinance amount for that one property is somewhere close to the down payment required for the seller financing deal. This effectively lets the buyer get 100% leverage and possibly come out of the purchase ahead on cash flow.


Risks:
The obvious risk here is can the properties operating cash flow support the total debt service (seller financing principal / interest + refinance loan)? You can use this model to figure out what terms have to be true in order to make the deal work. You will have inputs for ongoing operating activity of the properties based on rental income, vacancy, and operating expenses.


Output Tables / Analysis:
 - Monthly and annual pro forma / cash flow forecast.
 - NPV sensitivity table.
 - DCF Analysis.
 - Run the analysis for up to 120 months.
 - Exit cap rate to determine terminal value.
 - Debt Service Coverage Ratio (DSCR)


This template is also included in two bundles:
- All Models Bundle: https://www.eloquens.com/tool/P8Y4TX4v/finance/financial-forecasting-models/financial-models-120-useful-and-usable-logic
- Real Estate: https://www.eloquens.com/tool/vJdYH9R7/finance/real-estate/the-complete-real-estate-bundle