I am trying to purchase a triplex using seller financing. This will be my first home purchase and I am unsure what terms I should propose and how to calculate the deal to see if the numbers will work for this property. The property is currently being rented out with two of the three in a long term contract and the third paying month to month. Who would be the best person to talk to in this situation?
I've purchased 4 properties with seller financing so far and it's the best way to acquire properties (IMO). You still need to correctly analyze the property based on comps...And make sure that you're getting a good deal. Your money is made when you buy the property in a lot of cases. So always carefully analyze. Use calculators here and other online spreadsheets.
You can negotiate your interest rate, term (length of loan) and down payment -- Which can all be extremely advantageous in the current economic environment. The other great thing about seller financing is no loan points or fees from lenders...Saves thousands of dollars on the purchase. Use a solid RE lawyer for your purchase.
The main items you want to discuss are the interest rate, down payment, and the term of the loan. There may be other items that could play a part it will just have to depend on what you and the seller can come to an agreement on.
To calculate the deal I created my own excel sheet so I can personalize it for myself but you can always use the BiggerPockets calculator it is a great resource.
I've purchased 4 properties with seller financing so far and it's the best way to acquire properties (IMO). You still need to correctly analyze the property based on comps...And make sure that you're getting a good deal. Your money is made when you buy the property in a lot of cases. So always carefully analyze. Use calculators here and other online spreadsheets.
You can negotiate your interest rate, term (length of loan) and down payment -- Which can all be extremely advantageous in the current economic environment. The other great thing about seller financing is no loan points or fees from lenders...Saves thousands of dollars on the purchase. Use a solid RE lawyer for your purchase.
Your exit will also play a part in the seller finance deal. Depending on their situation, most likely the seller will want the loan amount paid back quicker than traditional financing terms. For example, a 5 year balloon may be appealing to them and gives you time to work on an exit (sell, refinance). The deal has to work for them and of course make sense for you. Larger down payments are also appealing as they may need cash right away for their own reasons.