Hello Everyone,
I've got a deal in progress on a 19 unit apartment building, the seller seems to waffle back and forth between wanting to sell and not but has indicated a desire for owner financing. This is great, in my opinion, because this way we can potentially both get what we want.
However...I've never negotiated a deal like this, and if there is anyone out there who might suggest some key points to consider while going through this process I'd love to learn!
What I know to consider: interest rates (I'm trying to keep them low), "term" the length can vary, purchase price, payment amounts...what else is there that I don't know?
The property cash flows nicely, but the seller operates and manages it all on their own. The desire is to sell the property with seller financing and be able to live off of the income without having to do all the managing work.
I'm thinking I can negotiate a purchase price lower then what is being asked, with a rate that beats the banks, and then have a term that is short enough to where the payments would roughly equal the current cash flow but would of course need to be slightly less. Also, there is room to be able to expand and create additional value and more potential cash flow from the property. I have a full time job that supports me at the moment, so not having gobs of cash coming in from this property isn't going to ruin me, as long as it takes care of itself.
As they say, you don't know what you don't know...
Also...more questions have surfaced since I began writing this...LLCs, should I have one for this transaction?
The current owner has the property belonging to an LLC, and I feel that venturing into commercial properties warrants a bit of "distance"...
Anyways, I've already met a few great contacts in my area (Charlottesville, Crozet, and Wayensboro in Virginia) from BP and it's suer cool to meet like minded people and go after some deals.
Ok, thanks in advance for anyone offering advice!
