Amid surging demand for apartments, the US rental market is contending with the largest supply of new units in four decades.

The maximum fixed-rate period seems to be seven years, and there is generally a balloon payment at 10 or 15 years.

She originally asked for 2 balloon payments.

I'm looking at monthly cost to seller vs. anticipated rental income, purchase price relevant to the ARV of the area and interest rate, balloon, etc.

Seller financing: Note for $1,350,000.00  - 7% amortized over 30 years with balloon payment after 7 years, interest only. ( I am trying to get the first year at 6% to stabilize then go to 7% remaining 6 years)Property Condition: Above average.

Balloon Payment:• At the end of 24 months, the buyer will make a balloon payment for 50% of the remaining balance of the loan.• This balloon payment will be paid through a cash-out refinance of an investment property valued at $198,000.7.

I'm not as worried about the 9 year balloon.

This makes targeting distressed sellers, such as those in pre-foreclosure, or those with ballooning debt that was taken out in 2020-2021 when the interest rate was 7.37x lower (8/09/2020 the 10-year treasury was .56%, 1/15/2024 the 10-year treasury is 4.69%) making it very difficult for those that underwrote the property in 2020 to have predicted refinancing at these rates and likely a sale is their only option.

You may have to add a Balloon Payment into the terms.

Could be 30 year amortization with a 5 year balloon.