Seller financed deal...looking for advice
I am in the process of crafting a seller financed deal on an improved land lot to serve as a vacation rental. It is in an area with a strong and proven tourism industry. The improvements are: approved building lot, underground electric and cable in place, a good perc test, and a gravel drive way to potential home site. It all fits into my model well.
The owner is willing to finance and is asking about what terms I'm thinking about. I did find a credit union willing to finance land with 25% down at 7% interest for 10 years. Although I have strong credit and could do bank financing, I would prefer seller financing as it keeps my credit and DTI clean leaving me open for other financing if i need it in the future.
What do typical seller financed deals look like...I don't want to present something really off base and insult the owner. What are the typical interest rates and length of loan on seller financed deals? How is the deed handled with seller financing...does it transfer to me as the new owner at the onset of payments like a regular home purchase with a mortgage?
I do not plan on working with a buyer's agent as I have already done the leg work for the property. I will use an attorney to draw up the necessary documents when the time comes.
Thanks,
Kathleen