Seeking Help Structuring a Seller Finance Deal in Cali

[Orion Walker]

Hi Folks,

I'm in conversation with a lady who has a property that I would really like to buy. She owns the property outright and is open to holding the loan. I made her an offer of 100k down and the rest over 15 years based on using a portion of the cash flow to pay her, but she responded that it wasn't enticing enough. 

I'm looking for ideas on how to sweeten the deal. Currently I don't have a lot of flexibility on a larger down payment. I can come up some on the monthly payment, but I'm wondering if there are other ways to structure/adjust things that might work best for her. 

One of her issues is dealing with the tax impact of selling. If she lives there for another year she said that will significantly reduce her tax hit. I was thinking I could offer to do a lease/option type arrangement so that we don't actually transfer title for a year or two. 

I've also thought that I could adjust interest rate and length of pay back to either reduce her tax burden and/or increase her interest income. If I pay a higher interest rate but lower the purchase price does that help her on taxes, or does she just take the hit paying taxes on the income from interest?

So, to summarize, I could suggest a lease/option type arrangement, I could increase the purchase price and monthly payments a bit, I could see if she wants to extend the loan timeframe and pay more over a longer timeframe... Any other bright ideas that might help to make this more appealing to her?

Thanks for any/all ideas and input. 

-Orion

[Ellis San Jose]

What about offering her more total money by paying her longer than 15 years? To reduce her taxable income you would want to pay less interest & more principal.

Is this her primary residence? if so she has a $250k exclusion if she is single.  Why not buy the house & lease the land for a few years. Then she can sell the land via 1031 deferred exchange.