Typical terms for a Seller Financing Deal - STR property

[Chaits J.]

Hello all,

How do you come up with typical terms while reaching out to someone for seller financing deal.

Should i just ask the owner if he is interested and if yes, then submit an offer with terms?

If that's the case what are typical terms. This is a STR property grossing 100K on an average and listed for 550K. I can do a 20% down.

[John Underwood]

I would get him to agree to seller financing first then negotiate terms after listening to what they want or need.

You could make 3 offers.

All cash wholesale price.  You can borrow from friends, family, private money or hard money, then refinance. 

Full price of what owner wants with owner financing. Divide the price by month's of term and that will be your payment. Don't mention interest rate if it doesn't come up. You are giving full price in exchange for no interest. You could add a 3, 5 or 10 year balloon if you need to and refinace before this deadline.

last offer could be slightly less than full price. Bank loan with owner carrying back 2nd mortgage for downpayment. Zero out of pocket for you.

Seller could need 30k and you might need to offer some cash to get the deal done.

Find out what the owner needs before setting your offer in stone.