[Calc Review] Help me analyze this deal

[Michael Muro]

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Bigger Pockets community we need help! My fiance and I are looking to purchase this house, which is in a really perfect area and should be cash flowing from day one. HOWEVER...

We're currently leasing a house (just moved from another state) and the lease does not end until May 2019. Additionally, there are 3 units in this house and they are all leased until June of 2019 - so we couldn't move in anyway.

Speaking with a mortgage broker, we were advised that - if we were to use a FHA loan as first time home buyers - for a duplex it would be 3.5% down. So approximately an $18,000 down payment not inclusive of closing costs. With a tri or quad, we would require more funding than we would need with a duplex; 3 months of mortgage payments need to be saved in the bank, which is not required for a duplex. This adds nearly $11,000 on top of the pile.

As mentioned previously, if we were to put in an offer today, there is no way for us to "owner occupy" until next June. Additionally, one of the units does not have a legal permit (it has been like that for 9 years). An appraiser is obviously going to inspect the house and our concern is that we then would not be able to finance as a duplex, not to mention the added property taxes.

Listening to Brandon Turner's The Book on Investing in Real Estate with No and Low Money Down, we thought maybe this property would be a perfect candidate for seller financing? Would anybody be able to provide some further advice on how to maybe go about this and thoughts on if this could work with this house?