Owner Finance Question For Multifamily

[Eric Lindsey]

Hello, BP community,

I am interested in learning about owner finance underwriting. Currently, I'm evaluating a property where the owner initiated a loan two years ago. My question is: How much equity should an owner possess in a property to make an owner-financed deal both feasible and beneficial?

Could anyone provide a mathematical breakdown or offer an example analysis on this matter? I would particularly value insights on:

Good Opportunities and Bad Opportunities Based On:

• The influence of the seller's equity on the deal's terms
• Down payment.
• Interest rate.
• Amortization.
• Balloon payment.

Thank you in advance.