Need Help Structuring Seller Financing Deal

[Cassidy Burns]

Hi BP,

I have an opportunity to do my first seller financed deal.  My property manager knew that I was looking to acquire more units and brought this deal to me, power of networking!  Below I have included some of the details that I have, I am going this weekend to view the properties and find out more details:

2 Different Duplexes:

*$39,000 for Duplex #1 (Assessed at $47,500)

*$20,000 for Duplex #2   (Assessed at $36,200)

Duplex #1 Rents: 

*$600 and $400

*$600 and $200

All In $1,800/month.  After running numbers i'm looking at around $780/month in positive cash flow .

The seller owns these properties free and clear and wants 5% interest and for me to pay any transfer/closing costs, i'm estimating $1,500.

My question is, how do you pay down principal on a deal like this?  Would it be worth it to do maintenance/renovations?  I typically like to add value by doing about $7,500 each building, $15,000 (dependent on viewing this weekend).  

Are you typically just doing seller financing for cash flow?  Eventually if I do renovation would I want to do bank financing?  

Thanks so much for any feedback.