How would you pitch this owner finance deal?

[Mark Wilson]

I have located a property I would like to purchase as a 2nd home. Seller owns home free and clear and may be willing to help finance.

Sale price of the home is 520k. I know the market well and don't anticipate any appraisal issues. Seller has owned the home since 2002. It has always been a rental and never been owner occupied. My income and DTI are excellent. My credit is above 800. I own one rental property free and clear and have a small note on my primary. This will be a 2nd home/vacation property. Would like to keep my down payment to 10%.

I'm considering proposing an 80/10/10 whereby I secure a conventional 417k first, ask the seller to hold a 10% 2nd and cover the rest in cash.

I'm wondering though if it might be more advantageous and attractive for the seller to hold the entire note. Home was purchased in 2002 and has always been a rental. Assuming the seller has been depreciating, he will be facing aprox 190k in recapture. Cap gains will be $0.

I would like to map out and present both options to the seller demonstrating roi and tax implications for each scenario. I'm not a sophisticated investor and am hoping some of the pros on this board can help me crunch the numbers for my pitch.

Thanks in advance for your help.