LoopNet and Seller Financing?

[David Stone]

I have been looking at various 4+ unit properties on Loopnet. Particularly I was looking at a 12 unit for around $350k. I was wondering if anyone had experience with Loopnet and knew if some sellers offer seller financing or mostly commercial loans?

[Joel Owens]

Seller financing has been dead in most markets for the last 4 or 5 years. Sellers market for multifamily currently.

If the seller wants to retire or the property is in a bad area or a lot of repair maybe the seller would finance for a short period of time.

They would want to see a certain down payment because if you do not perform and they have to foreclose on the property it will cost them time and money and you might had the property back worse than when they gave it to you originally for cash flow and occupancy levels.

Don't buy a property just because of owner finance. The terms and purchase price can often be non-optimal to a successful outcome.

Some of the no money down stories you hear still had money involved to close the purchase and reserves needed for stabilizing and capital injections for the property.

If you have little to no money then focus on a quality deal with upside and not a cheap deal in a marginal area and get an investment partner. They stay passive and you do the heavy lifting to create some cash flow and equity over time for yourself.

Be wary of investors selling books with no money down. The market cycle 4 to 5 years ago was very different and owners did not know when the markets would turn around so were very open to have a headache off their plate in any way possible. Today sellers see multiple out strategies to sell so owner finance of most of the purchase is a last resort for many of them.

It's not impossible but a lot tougher in today's market.