Seller Financing negotiation tips

[Sean Haardt]

I’ve been BP Pro member for about 9 months and am about to make my first offer on a home converted to a 7-unit apartment. 

I have a seller offering to do seller financing. He says he'll give me a good rate for 5 years and then come back in 5 and offer another rate at below market assuming his health is good. I'll find out what that rate is Wednesday when I meet with him again at the inspection. He seems like a nice and trustworthy guy. He is 72, does quite well, owns a restaurant in town and has many properties including several in Rio de Janeiro and wants to unload some of his stuff as his children aren't interested in REI. The property just appraised at 240K 10 months ago. He suggested I get an appraisal and make an offer. When I called a local appraiser, the appraiser told me he had just done this property last year. When I asked the seller if I could use that appraisal rather than spend another $1100, he said sure and sent it over. My questions are 1) is $150 a door enough of a cash flow (I've done the BP calculators over and over with conservative numbers) and 2) what do I do/ask at the negotiating table with a motivated seller to get the best deal I can without nickel and dimeing my way out of it and insulting him or wasting his time. I don't want to offer the full appraised value do I? It was appraised using cap rate and income. He also has another duplex he is selling that I am considering buying from him. Do I ask for some sort of break for buying both properties? Any insights would be greatly appreciated as this is my first deal and I can't afford to blow it J. Thank you BP community and thank you Josh and Brandon. (I'm a full-time high school history teacher but have always wanted to invest in real estate. I'm trying to learn as much as I can and minimize my risk as much as possible. I have read several of the books mentioned in the podcasts and on the site. I listen to the BP podcasts every day at 1.3 speed. I have listened to about half so far and they are all I listen to in the car, walking the dogs, in the shower, …. I won't listen to anything else until I finish all 200+. I'm to the point where I cancelled my Sirius subscription. I'm committed.)