Christian OsgoodCEO, Multifamily Strategy · CEO at Multifamily Strategy

What Are Special Clauses?!

22 Dec 2023 · 1 min

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Christian Osgood explains special clauses as contractual tools in multifamily real estate that let buyers and sellers meet each other's terms. A staged interest-rate clause might start at 3% in year one, climb to 7% by year three, letting a deal work for both sides.

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Special clauses. What are they? Well, what it's not is not Santa's special little brother. What it actually is are simple clauses that you can do as additions to your contract to get a deal closed. In creative finance, you get what you negotiate. You can do something very simple. Say someone wants to get 7% interest, but your deal only supports 3% interest day one. You can create a path that says, hey, day one, you pay 3% interest only, and year two, we'll jump to 5%, and year three, we'll jump to 7%. You can create a path to say yes to everything a seller wants with simple special clauses. If you haven't used these yet, check out creative finance. If you don't know how to do it, check out our YouTube channel. Cody and Christian Osgood, Multifamily Strategy.