Paying off a partner on a seller financed deal

[Justin Pumpr]

Hey all,

I want to acquire more proeprties and the best way to do this is with OPM. I'm wondering how you go about paying back the private lender when the property will be a buy & hold.

Example:
Purchase a property for $200k using seller financing and manage to get 5% down with a 0% rate over 30 years with no balloon. Down payment and closing costs will be roughly $15,000 which will be the amount I need from the PML. 

PITI is ~$750 Propery will rent for $2k/month

The PML lends the money at 10% interest and want their money back in 6 months. Apart from saving the cash to pay them back their $15k, how can you structure this so it's works for myself and the PML gets their money back?

I don't want to refi the property after 6 months because then I'll be paying a much higher rate and the property won't cash flow as the monthly expenses will now be around $2000 with PITI ~$1550. That's assuming the property is worth at least $250,000 to be able to cash out $205,000.

Any ideas?

[Chris Seveney]

@Justin Pumpr

Reason I asked is your not going to find a deal that will work for you. Your 100% in debt and upside down 10-20% because of closing costs and if you had to sell, selling costs.