For sale by owner negotiating

[Luke Harrison]

I am in negotiations on a for sale by owner deal. It is currently being used as a mixed use short/long term property. The property is currently being managed as a mixed use short/long term building. 2 apartments 4 hotel rooms. This market does not support the short term side of renting, but is in need of housing. I would need to convert the 4 hotel rooms into 2 more apartments making it a 4plex for long term tenants.

The  owner of the property is "open to anything to get it off his hands". He currently owes $135k on mortgage, and wants to get the purchase price closer to $200k. He is willing to owner finance, but his bank won't let me assume the current mortgage. I can probably negotiate it to $175 or under. Market rents would probably be around $900 a unit, plus coin operated laundry. Monthly rents+laundry would be in the neighborhood of $3,800 a month when reno is complete.

Is there a way to make this a no money deal for me other than renovation costs? what options should I be offering the seller as far as creative finance goes to make this as low cost to me as possible? This would be my first owner finance/creative finance deal.

I currently own, and self manage 18 units, and do all of my own renovations for context.