Second Home Loan with 2 Owners out of State?

[Daniel Dietz]

Hello All,

I am looking for advice for two family members getting a loan for a "vacation home" in another state - Arizona specifically. The home is appraised at 180K, but the selling family member is willing to sell it at a steep discount to 'keep it in the family' for only 120K. 

The two parties that are interested in buying it both have excellent credit in the 750+ range. One has on FHA Loan on their primary, and the other has both their primary home loan and 6 rental property loans from conventional markets.

What would be the route to go to get the best rate and especially a long fixed amortization? Are there any programs that would allow a 'nothing down' loan due to the 33% equity? The seller would strongly prefer not to do an 'owner financing' but might consider doing part of it that way if it would help. The goal would be to get a good rate fixed for a long time (preferably 30 years) more so than having a low down payment amount.

Thanks, Dan Dietz