Unbelievable VTB Deal! 14% ROI? You Won't Believe This!

New studio, new look, same deep dives. In episode 144 of the REI Hot Seat, Dave and Jacob break down a 25-unit building near Bruce Power in Hanover, Ontario and show how a well-structured VTB can turn a solid deal into a great one.They walk through the numbers, cap rate, price per door, cash-on-cash returns, and then dig into how to properly structure a Vendor Take-Back (VTB) clause so it actually works at closing.If you’re serious about multifamily investing, VTBs, and creative financing, this one’s packed with real numbers and real strategy.Don't forget to join the Insiders list for access to off-market deals and other unique opportunities.

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EP E144 - Unbelievable VTB Deal! 14% ROI? You Won't Believe This!

0:00 – New set, new look & show update

0:20 – Andrew’s Florida investing podcast & REI Hot Seat format going forward

1:00 – Bringing on more industry guests (not just deal analysis)

1:45 – What types of guests do YOU want? (comment below)

2:06 – Deal intro: 25-unit building in Hanover near Bruce Power

2:35 – Unit mix, building style & long-term ownership story

3:19 – Asking price vs. target price, cap rate & ~$200k per door

3:56 – Why buyers are obsessed with price per door right now

4:34 – Cap rate vs. price per door: why you can’t look at just one metric

5:02 – Challenge with CMHC and why a VTB solves the problem

5:26 – Seller offers a $4M VTB at 3% for 5 years (first position)

6:01 – 82% loan-to-value and why that’s attractive for investors

6:13 – Why VTBs should almost always be interest-only

7:00 – Creative way they structured a past VTB with a lump-sum principal paydown

7:28 – Calculating interest-only payments (~$10K/month)7:42 – Debt coverage ratio revealed: 2.35x on the VTB

7:58 – $154K annual cash flow & 14% cash-on-cash return on ~$1M invested

8:53 – How long it takes to get your money back at 14% cash-on-cash

9:34 – Why the seller loves the VTB: tax mitigation & steady income

10:18 – Big picture recap: location, units, capex, VTB terms & upside

11:00 – How to properly write a VTB clause in an APS

11:28 – The must-have terms in every VTB (principal, term, rate, interest-only, etc.)

12:23 – Open vs. closed VTB terms & why open often makes sense

13:00 – Get your lawyers involved before going firm

13:36 – Why you need lawyers who understand multifamily & VTBs

14:42 – Deal still available (for now) + who this opportunity is right for

14:51 – Free deal calculator & off-market opportunities that never hit MLS

15:11 – Wrap up & what’s coming next on REI Hot Seat

DISCLAIMER: THIS EPISODE, AS WITH EVERY EPISODE OF THIS SHOW, SHOULD NOT BE CONSIDERED AS ADVICE. INVESTMENT ADVICE IS NEVER GIVEN ON THIS SHOW. ALWAYS CONSULT A COMPETENT INVESTMENT ADVISOR BEFORE MAKING AN INVESTMENT DECISION.