Need some help! Second position seller financing

[James Fraundorf]

Hello friends! Does anyone have any lender recommendations for a Lender who will finance with a seller financing in second position for a small multi family  investment property in Minnesota ?  My business partners and I are trying to figure out how to write up this offer and also to find a lender who is okay with having the seller in second position.  80 percent lender finance, 20 percent seller financed.  For the Seller financed portion, we don't want a "contract for deed" correct?  because that doesn't give us the buyer the title in our name until the full seller financed portion is paid off?  Hope that makes sense!  Really could use any insights you might have.  Thanks so much!

[Tim Swierczek]

@James Fraundorf I've done multiple of these and my wife has brokered several.  Here's what I see.  Most lenders are hesitant to give you financing with no skin in the game for the first deal.  It's more complicated because you live in Seattle and not Minnesota.  I could see a more typical structure to be 75% bank loan, 15% seller second, 10% cash from you and your partner.  You may be able to do a bit better but those are the most likely terms you will be offered.  We have never structured them as a C4D so that shouldn't be an issue.  The bank you go with will require the seller to sign an agreement that includes an assignment of rents in case of default.  If your seller second balloons, which most do, I highly recommend that the balloon lasts at least 5 years or it will impact the bank's terms to you.  PM me if you want to zoom and discuss it in more detail.