Paying back hard money lender

[Bo Banner]

Looking to buy our first deal which is a buy and hold that cash flows well. We have a private lender who wants to give us $40k for the down payment and wants to be paid back within 5 years. He’s a family member so he’s willing to help us out but still wants a 3-5% return on his money.

The problem is trying to figure out a way to pay him back without giving up a ton of cash flow. Any thoughts?