Please explain owner financing for my situation...

[Eric Denson]

I was wondering if someone could explain in detail how to owner finance this property. I've got great credit, job security and 25% down on a 67k purchase price for a 4-plex in rural Alabama. The problem is I can't get a standard loan because the appraisal states that one of the units "is in poor condition, however it is a livable conditions". There are actually hoarders in this unit. The property is fully rented, needs minor repairs and appraises for 120k but this unit is keeping me from getting financing.
If I give the owner the 25% and arrange for a balloon payment, do I still make him monthly payments? For how long and at what %? Once the balloon payment is due, what do I do then? I guess I'm supposed to have that hoarder cleaned up and go get regular financing, but I've already used up my down payment to the owner. How do I get financing then?
Thanks!