How to Owner-finance part of this deal?

[Kevin Danikowski]

Hey All,

I have an owner that is very willing to do owner financing as long as I hit his purchase price (PP). He owns 150k equity in a 350k 3 unit property. I'm trying to figure out my best course of action to do 100% LTV because I'll need to put up 20k toward a new roof after the sale. Everything else in good condition.

Strategy 1:

Wrap around mortgage. He refinanced with a 4.75% 30 year loan 3 years ago and owes 200k on it. I would then have a mortgage where I pay him and he pays his loan. 

Strategy 2:

Find a bank that will take first position for 60% of PP, and seller takes second position for 40% of PP. 

Both of these have a due on sales clause risk, I'm not sure of the severity of that risk, but since there may be a market recession soon, is that risk magnified? I would believe it is the opposite since the bank doesn't want an upside down property? That's another thing in itself.