Owner financing - What are fair terms in your opinion?

[George Paquette]

I am looking at a property to BRRRR for $300k and I threw it out to the owner to owner finance it. She said yes and for what terms? I wanted to get some ideas that people have received for owner-financing and to see if you would share the terms?

[Charles Carillo]

@George Paquette

I have found with seller financing that the owner usually has an important item that they are focusing on; it could be the price, down payment or interest rate. I would feel them out and see what they are most focused on and build the deal around that. 

For example; the price is $300k but talk to them about putting down x% as a down payment and y% for an interest rate and see how they respond. If the property has minimal deferred maintenance; I would shoot for 5%-15% down and a term of 10+ years (see how long they will go) with no pre-payment penalty. If the property needs serious attention; I would try and deduct this amount from the down payment and tell them that you will put a clause in the contract that states the work will be completed within x months.