"Church" Purchase Creative Financing

[Allison Littman]

I am currently trying to close on a church in Nashville (residential R6-A zoning) and convert it into my primary residence. Two separate property appraisers (at the direction of the lender) were sent out to appraise, and neither was willing to appraise it as a "residence", and thus financing fell through (conventional primary loan). At this time, I am having to pay all cash in order to close.

Purchase price is approximately $600k. Since I'm taking such a cash hit, I asked the sellers agent if they would be able to designate some portion of the sale price ($200k?) as a "donation" (translating to the benefit of taking a deduction for 2025). They are amenable. My agent is saying that we are unable to split the contract that way (or reduce the purchase price), so I'm trying to figure out options. My tax professional is stating that I would need an appraisal to show the lot/structure are valued at $400k if I try to claim $200k as a donation.

Looking for any creative input on how something like this could be structured.