Owner financing on a trailer park

[James L dodd]

How much down would you consider on a owner financing deal. I've been offer 20% down monthly payments on a 3 yr ballon. Owner says intrest rate negotiable. NOI about 15000 a year priced at 189000 6 units

[Chase Louderback]

Hi @James L dodd

In my opinion, I don't think it would make sense to go more than 20%-25% down on a seller financed deal.  25% down would be conventional financing terms so if they start to require around that amount you should be getting much more favorable terms on the deal (for example, amortization at 30 years, 7-10 year balloon payment, interest only for 1 or 2 years, etc).

The big thing would be for you to confirm that the NOI is accurate. Looks like the seller is trying to sell this at roughly an 8% cap rate.