Is seller financing feasible for this three family

[Alex Jean Baptiste]

Speaking to the seller of a 3 family. worth 1.3M. They only have $250,000 left on the mortgage and are looking to buy another place out of state outright in cash. (for $400-500 if that information matters) I want to offer to pay off whats left of mortgage plus what it would cost them to buy a property cash else where and then have them being the mortgage holder for the difference. Idea is to use a private loan for the 700-800k to cover the payoff and new property and then pull money out of the property itself using the refinance (I doubt I can afford the 1.3 amount through a refinance) I'll rent out the units and pay the sellers monthly but I'm running into a wall thinking about paying the private loan or the initial money borrowed. 

I've been reading so much about creative financing and would like to really throw this idea out to the seller this week. What say you? What blindspots do I have? Has anyone ever done this and it did or did NOT work?