Owner finance deal?

Question

I've found a low income property and I'm discussing owner finance with the current owner.

The property currently has a tenant but is being evicted.  He was paying $500/ month on a rent to own term.  The house sold for $31k in 2007 and $24k in 2012 (that was the rent to own price to current tenant).

Inside of home is fairly updated with newer ac and roof.  Outside needs some finishing such as window caulk, paint and a few trim pieces.

I haven't found any rent info but I'm guessing $400ish / month potential.

Owner is offering the house for $18k.  Will finance with $3k down, 2.5% interest on $15k. Taxes are $800/yr. Insurance is $78/ month.

I have not physically seen the property, but have looked at photos.  Owner is an investor that moved out of the area.  What else do I need to consider?  How does the taxes and insurance work on an owner finance deal?  Does he continue to carry taxes and insurance and is everything transferred to me?  Any feedback is appreciated.

Jeremy Jackson · Answer

He is in the process of evicting current tenant.  I believe I'm going to pass this on to a friend who loves these type of properties.  Thanks for the reality check. :)

Jeremy Tillotson · Answer

@Jeremy Jackson depending on many factors the rent to own part is what scares me in this. You want to make sure you can evict, how much did he put down and when, did he improve the property. You may have to foreclose, which is time and money. Not sure put investor may be playing the bigger sucker theory here.