seller financing question

[Stace Hill]

have a fsbo, seller is asking 104,900. in this area will get a full price offer if they put it on market which they plan to do soon. Home may appraise for closer to 100,000. One side of a double. Not condo or HOA, built in 90s 2 bed 1-1/2 bath one car garage 1200 ft. I may be able to get seller finance for 650 interest only payments a month for 3 -5 year balloon, am offering purchase price of 100,000. Basically comes down to 6.something % interest until balloon is due. Rent will go for 950 to 1050. place is in an awesome neighborhood on a corner and very well taken care of. Should be able to get down payment of 20% together much sooner than balloon is due. At that monthly payment think i can get for no or very little money down as they are interested in cash per month. Taxes, insurance around 2000 a year.

Hoping to start posting more and really appreciate any comments on these numbers.  I know it is tight but with little or no out of pocket cash it is still around the 1% after getting the 30 year loan in a couple years if that long.   We have 3 other properties in this area but this is the good side of the tracks and these do not come up for sale very often.  

thank you again for any comments!

[Tiffanie Ellis]

I just did that in Greenwood with a 3/2 SFR, but I did it as a 2 year lease option. 5% interest, amortized over 30 years so the seller is getting $500/month, but I have to get it financed within the 2 years. It will rent out for $1050/month.

I think you're being too generous paying $650/month in interest. You should have some of that payment paying off your balance every month, even if it's just a little.