Seller Financing on a 32 Unit

[Warren Straley]

For those of you out there who have done seller financing in the past (as the buyer or the seller) what is your experience with this, and what terms did you end up coming to in the end? I just purchased a 12 unit, and really like the numbers when you do economies of scale. Would like to get more units under my belt, but a little cash poor at the moment. Looking for some advice/guidance on seller financing topic. Thanks in advance!!!

[Joel Florek]

@Warren Straley I have closed a 16 unit and closing an 8 unit using 80% with the bank, 10% to 15% on a seller 2nd position note and I only bring 5% to 10% to closing. Has worked well for me but finding motivated sellers willing to keep some skin in the game for 18 months to 36months is tough since there are so many buyers. Finding a bank to work with this structure can be tough buy clearly not impossible. 

Terms on my 16 unit were 15% of the purchase price at 2% interest rate on a 10yr amortization with a 3 year balloon. 

New deal is 10% of the purchase price with 5% interest rate on a 20yr Amortization with an 18 month balloon. 

Let me know if there are any questions you have! 

Joel