Help! Commercial Property / Family Partnership

[Jim Douglas]

I have an opportunity to invest in a commercial property and need some help. This is the backstory. My grandmother's trust is attempting to liquefy all of her assets. One of which is a commercial building that I have helped manage over the years, along with my sister. My sister and I are wanting to partner to purchase the property.

We do not have the funds for a conventional loan, so we are preparing an offer to the trust. Our plan is to have the trust owner finance with a 5 year balloon mortgage. This would allow us to build enough equity to then refinance with a more conventional loan. This would also allow the trust to be out of the deal after five years. Does this sound logical? Any other ideas?

The other part of the equation is the partnership. Should my sister and I form an LLC? How would this affect our personal credit and borrowing power? Thanks for any help in advance.