Seller financing mindset

[Gilles D.]

Hi everyone,

I currently own a home outright that almost doubled in value over the past 5 years. 

It shot up from 750K to about 1.4M based on current comps.

Now, I am considering seller financing on this home as I'm close to retirement.

Currently I am making about 3K net cash flow on this property after all expenses paid, but obviously a ton of equity is unused at this moment. I am waiting on something to clear up before I can sell. This will be in August.

I was wondering about seller financing and offering a better rate to the buyer to make it more appealing.

Now, I can't really wrap my head around as to why this would be advantageous to the buyer.

For me, with a 5 year balloon I'd make about 300K extra off the property. Assuming a 300K downpayment.

If the seller agrees - yes he gets a 1% better rate than the banks would give him, and he doesn't have to qualify...

But when he refinances when the balloon is due, he will end up paying more interest if he refi's to a 30 year conventional.

So even if I offer him interest only for 5 years, he still ends up paying a lot more. His biggest advantage is in lower monthly payment... Right? But this is more of a family home than an investment property.

For me it would be "easy" money, obviously I need to factor in the opportunity cost of not putting the 1.1M to work for 5 years.

is there anything else I'm missing? Or is a deal like this really a win-win?

Who comes out ahead the most?

Hope that is kind of clear and any input/advice is very much welcomed! 

Thank you!