Need advice owner finance…

[Trent Stevens]

Hey everyone I want to thank each and everyone one of you for taking the time to read my last post and this one. The comments and advice have been great. I got on BP for advice about investing and you all have been great. There were a few post that told me to maybe look with in two hours of my home instead of out of state investing so I am. Hopefully I can move to out of state later when I have some more experience in this. Well I found a deal in the town I work out of. its 15 minutes from my ranch I live on let’s see what you all think. It  Is in a sleepy little town about 30 minutes north of Paso Robles ca it’s a large lot with two homes built is the 1950’s one is a 3b 2ba rents for 550 a month the other is a 2b 1ba rents for 425 month the owner has had the property about 20 years. With same renters that have never missed a payment. Rent should be around 1500 each. She said that she as not done much maintenance in the time she has had the property wants 300k and willing to owner finance we have not talked down payment or interest? What are your thoughts? I am leaning more towards conventional loan because I feel if a bank will loan to me. if I need to sell the property for any reason someone can also get a loan. Thanks for your time!!

[Kevin Sobilo]

@Trent Stevens, if the existing tenants were paying $1500/month and the property was in good repair then this would sound good. It sounds like you need to get the current tenants out which may not be easy, simple, or cheap in your state and then do some rehab to the property before renting it back out again.

A couple ideas to consider:

1) Have the owner boot the tenants and provide the property to you vacant at closing. This way you reduce the time/risk of getting them out plus then you get to see the property vacant to better evaluate it. There is almost 0% chance tenants are prepared for their housing costs to triple. So, they almost certainly have to go no matter what.

2) Did the owner suggest owner financing or you? A savy owner might suggest owner finance to get a higher price knowing many buyers aren't able to get a loan from a lender and would be willing to pay a bit more for owner finance just to get into a property.

So, if the seller offers owner finance, that could be an opening to offer less with a conventional loan.