Thoughts on an offer for a property…
Hey all…I have a 25 unit property for sale and have received an LOI with some seller carry terms. The buyer intends to get enough conventional debt that we could pay our mortgage off as well as closing costs and have a little to put in our pocket. And in addition we would carry a second note at 6% over 30 years with a 5 year ballon, the gravy portion. With what the property has cash flowed since owning plus the extra left over after closing we would get our initial investment out plus maybe $50k. From what my broker is telling me these arrangements are becoming very common with what's going on with interest rates. When I look at the deal from his side, and what his debt service will be, the property will still cash flow very well so I feel our second is secure. Thoughts?