Any Creative Finance Wiz Kids in Here?

[Kyle A.]

I'm looking at a deal thats current gross income is <110k with poor management, kind of run down, but in a good area. They have an asking price of 2.1m that's based off a gross income of 432k. After speaking with local PMs in the area, the property could be stabilized in current condition to have a potential gross income of around 150k, however after rehab (with ~4-500k+ capex budget) could stabilize rents closer to 400k+, and potentially appraise for 2.5-2.7m.

After falling out of contract, seller is willing to negotiate with seller financing terms of 1.5m, 5% i/o until jan. 2025, with interest going up to 10% after that, or satisfying balance at that time. I'm trying to get into this deal with minimal cash out of pocket so was thinking about financing the capex budget and down payment (or as much of it as possible). Main problem I'm seeing is getting a second position loan on a property that will appraise low in current condition.

I'm still not very savvy with the debt/equity side aspect of deals so if anyone has any helpful insight, I'm all ears! Already submitted LOI so trying to figure this out sooner rather than later.