How are you requesting seller financing?

[Scott Forney]

Hey everyone, hoping to get some perspective from experience investors about seller financing. My wife, @Amanda Forney, and I just purchased 2 duplexes in our hometown (very small town) and are ready to jump in with both feet, and continue to invest in real-estate. I love these multi-family properties, the risk of the property is spread across multiple units instead of just one. If there is a vacant unit, the other rents are covering the expenses while we are filling the unit. 

There is a four-plex in town that is owned by a local guy that I know (everyone knows everyone here), and I would like to approach him to see if he would be interested in selling the property. Property is in good shape, I am guessing it may be a little outdated though. If he is willing to sell, I would prefer seller financing. I can see that he purchased the building from his father back in 2003 for $70,000. I think $150,000 would be a fair offer to make, if he is willing to sell. The NOI on the property is about $2300/m, running the number on the rental calculator makes is look like a amazing investment for that price. Playing with the numbers it looks like $170k would be as high as I would want to go. the reason I am thinking of seller financing, is because our money is tied up in the recent duplex purchase, so once we replenish our saving then, I could consider refinancing this four-plex.

How have you approached others about selling properties that aren't on the market, and talk them into selling, especially when they are making them an income? What kind of contract would make it attractive for the seller, I am thinking an interest rate of 6-8%? A 5 year repayment plan with 30yr amortization? I don't want to be unreasonable, but also don't want to miss out on a deal by offering too little or too much. 

We're new to this, and learning so much everyday!