Creative Finance Deal Need some options

[Nixon Vayupak]

BP family I wanted to run this by all of you and please tell me what you think. I have a seller, who will be selling their mother's house since she will be going into a nursing home. The money gain for selling the house will be all transferred to the mom. This house is currently known as the primary address for the mother. The seller is asking for 477K net 'As-Is'

ARV 655K
Repair Cost 70K

Seller received the following offer from different investors:
Investor 1 - 420K Cash Offer As-Is
Investor 2 - 437K Cash Offer As-Is
Investor 3 - 450K Owner finance and holds a second only. (Seller like this concept, but does not like being in second position)

Seller indicated that they are not in a hurry to collect all the money. They just want the money for their mother who would need as some type of annuity.

Can I offer this and would this be realistic or am I just dreaming. 

Offer - 477K Owner finance - Seller will will hold loan in first position

360 years - 0% Interest - $1305.56 monthly payment - 5 or 10 year balloon.

Better yet, can someone and help by providing a better solution. Not sure how to make this deal work and how I can spin this with less money invested as possible.

[Mehran K.]

I have limited experience negotiating seller financed deals (only have had seller carry backs on purchases). But it seems to me that the seller has indicated two things

1. They don't like having 2nd position on their note (though I'm a little confused as to how their $450k note would be 2nd position, do they own the property free & clear?) Or is Investor #3 getting another loan that's taking 1st position? Please elaborate

2. They prefer monthly payments than a big sum of money (the annuity factor).

I feel like your offer for $477k, 1st position, makes great sense. I hope you mean 360 months! Maybe give them the choice of 10, 15, or 20 year balloon? I'm not sure what your plan is for the property and whether you would need the extended balloon or not.

I think at least at that point they may want to negotiate with the term or the rate/payments. That will indicate what's more important to them. Keep us posted on how this turns out please, I'm curious!