HOW TO EXIT A SELLER FINANCING DEAL

[Devonte Thomas]

I am currently confused on how I would exit a seller financing deal that has a 5 year balloon in the P&S agreement. For example let's say the terms state that the purchase price is $380,000, DP is $19,000, Amortization is 30yrs, interest is 4% and seller wants a 5yr balloon. At the end of the 5yrs I would have paid off a total of $72,200 (not including property tax and insurance) leaving me with a net balance owed on the property of $288,800. If I were to use a cash-out refinance of up to 80% on the property and the property value didn't change so the loan would be $304,000 would the loan be paid to the seller? What happens to the left over amount of money? Would I have to put 20% down since the loan only covers 80% of the assessed value of the home?