Quote from @Hector Espinosa: Hi,I'm negotiating a seller financing deal which may be my first one and would like to ask for some advise about and what are advantages and disadvantages about seller financing deals.These are the seller financing terms:House Price: $330,000.00 USD​ (Sellers still owe ~$301,000 USD)Down Payment: 5% = $16,500 USD​Loan Amount: $313, 500​ (Monthly payments will be amortized as a 30 years loan​)Interest Rate: 4.531%Balloon Loan Term: 5 YearsMonthly Payment (P&I): $1,594.24​Closing Costs:  ~$3300 ​Zip Code: 74105Observations:       * HVAC requires an update but pending to inspection (replacing with a new one will cost ~$10,000 - $15,000 USD )     * Expected Rent Income: $2,000- $2,300 but this is has been really complicated to get a good estimate because is all over the place in the different sites I have checked

I have 30-year fixed rate loans on all rental properties. 

Say, 3 month later, I decide to do a cash out refinance of the replacement property at 75% LTV because the rate is lower.

If that's not the monthly income, you are arriving at your cap rate by using incorrect expense ratios/expense figures and/or the property benefits from an extremely favorable tax abatement which skews the operating costs.

I have heard that interest rates for a DSCR loan are generally 1-2% higher than conventional loans depending on the LTV ratio and credit score.

Say, 3 month later, I decide to do a cash out refinance of the replacement property at 75% LTV because the rate is lower. 

Ensure the STR’s projected income comfortably covers new debt, even with conservative occupancy rates, and maintain reserves for market changes or vacancies.

But I am open to ideas.I see this environment as quite challenging to find a deal that will cash flow reasonably well in my area due to HCOL and interest rates (even as somebody with some resources). 

The rates are better.

It potentially can be possible if you provide your capital to a fund who operates as a private lender.You would have to be a non-managing member in an LLC or an LP in a Partnership.Therefore, you would have no say in items such as who to lend the money to, at what rates, etc.Best of luck