.$25k is the amount they will pay you up front.They will pay you the remaining 47k in the form of an interest only mortgage with a principal payoff at year 4.Lets use an example. $47k @ 8% annual interest is $3,760 per year or $313.33 per month.

No principal is not going down - I did an interest only loan because I was blinded by the pre-construction flip greed.

I show the seller basically three options, 1. they can sell for cash and pay the cost to sell, which is about 10% of the value of the house, 2. secondly they could rented out and wait for appreciation and there's knocking to be very much principal paydown, and 3. lastly they can offer the property for lease to own, somebody moves in and pays their market rent for period of time, works on their credit rating and their ability to borrow money, and then pays full price and also pays closing costs.

@Doug KeefeHello from the Big Island ;-)That line means that CMHC will allow an LTV of 85% of the {appraised} value of the building or 100% of the construction cost (for new buildings) whichever is lower.It's basically saying if you spend $1,000,000.00 to build a 12-unit building, but it appraises for $800K in the present market, that CMHC will insure a loan principal up to 680K {provided the deal qualifies for the 85% LTV ... many only qualify for 75 - 80%}.Conversely, if you built a 12-unit building at a cost of 600K, but it appraised at 800K, CMHC would only insure a loan principal up to 600K.

If there is a risk in this type of lending, the risk is normally borne by the principals of the entity.3.There are a limited number of lending sources for these types of loans, with only three national lenders.

His thinking as to his goal of paying of other loans may not be the best approach as his payment now in an old loan are contributing more to principal reduction, his real interest expense is declining, even at a higher note rate his cost may be less.

At this level, I am finding that the lawyers do what the principals request- they have as much knowledge of the law for basic structure as the attorneys.Speaking of lawyers, I took my step to put my legal structure and team in order.

If you are submitting a purchase agreement as the "buyer or assignee" then you are the principal and shouldn't require a license (I'm also not a lawyer).  

I am a licensed developer in Oregon I am the principal in all that I do here.IN other states I build in I am the principal but its not necessary to be a licensed developer Oregon is unique in that law.. and of course in Oregon that law is broken with the same frequency as those that wholesale without a license in states it not permissible to do that.

Unless you are a passive / limited partner in your Colorado LLC, CA expects that you are doing business in CA with your Colorado LLC, owning Colorado property just because you as a principal in the company live here (ridiculous I know).