Looking for Feedback on Seller-Financed Multifamily Offer

[Rick Grams]

Hey everyone,

I’m reviewing a seller-financed offer I received on a 6-unit apartment building located in my area (Los Angeles). I’m evaluating if this kind of deal structure benefits either party, and I would love to hear what others think.

Deal Terms:

• Purchase Price: $4,000,000

• Cash to Seller at Closing: $120,000 

• Listing Agent Commission: $120,000

• Seller Carry Note: $3,760,000 (balloon after 7 years)

• Monthly Payment to Seller: $10,444.44

• Estimated Net to Seller: $3,880,000

• Closing Timeline: 30 days

• EMD: 1.5%

💵 Actual Current Rent Roll:

• Unit 1: $1,599

• Unit 2: $1,623

• Unit 3: $2,184

• Unit 4: $3,016

• Unit 5: $2,010

• Unit 6: $1,776

  Total Monthly Rent: $12,208

[Tyler Thorson]

If your rent is 12k your going to have trouble servicing debt of 10k pretty quickly unless you have reserves.