Seller Finance Deal in Minneapolis

[David Lind]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $260,000
Cash invested: $15,000

Deal was brought to me as a seller finance deal. 6 Bed 2 Bath in the Jordan neighborhood of North Minneapolis.

Seller requested 10% down at 4% interest with a 5 year balloon. Ended up taking down the deal with a partner and have roughly $15k in the deal. Cash flow is around $1200/month and is through a veteran subsidy program.

What made you interested in investing in this type of deal?

It was my first time using seller finance! If I could do every deal that way I probably would. Awesome tool.

How did you find this deal and how did you negotiate it?

My realtor brought me the deal. We ended up partnering on the deal and we negotiated a 10% down payment instead of the original 20.

How did you finance this deal?

I took out a 401k loan to finance the deal.

How did you add value to the deal?

I added value by taking care of most of the business setup as well as the administrative side of the deal.

What was the outcome?

We used a property manager to take care of some minor repairs and get it rented in less than 30 days. Currently cash flowing roughly $1200/month but knowing that in this neighborhood we need to keep a fair amount of reserves on hand.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Eric Robinson @ Rize Realty

[David Lind]

@Wale Lawal

I completely agree that there are risks involved! I think it’s important to know that there is no real estate deal that doesn’t come with some amount of risk. 

I think you’re right though in that we can mitigate some of that risk by having other professionals in their fields help us navigate through sound decision making!