3 duplexes, seller financing, curious on terms

[Jacob George Lada]

Hello, I am currently interested in buying 3 duplexes. All are currently rented and bring in 4500 per month gross. Property taxes per seller are 8,000 per year. The owner wants to do seller financing with these terms Asking price: 600,000 but says he is not totally firm. Down payment: 150-175,000 Interest rate: 5-7% Payment: unsure yet but wants a balloon in 5-10 years. So I'm posting looking for advice as I am going to meet with him next week and discuss further in depth about buying the property. I have over 60,000 in savings so also interested in ways of obtaining money for the down payment. Thank you

[Charles Kao]

@Jacob George Lada

Negotiating seller financing is all about knowing what you want and the seller wants and making them think they are getting what they want. For me the most important thing for me is cash on cash return so I focus with as little money down as possible. If the seller is focused on a certain price I give them that price but ask for better terms. If they want a high down payment then I point out a bank will finance repairs so a land contract may not be as beneficial to me as I think and again ask for better terms. This is a general message mainly because you have given general information but build rapport with the seller as much as possible

and make sure they are confident of your execution to pay. We are working on a 2.1 million apartment purchase where seller has already agreed to drop down payment from 20 to 10 percent because they are confident we can run the property better than they ran it. They would not have done this if they perceived our ability to manage as an added risk. Hope the negotiations go well, feel free to reach out with questions. Remember choice of words and presentation matters.