Updated almost 3 years ago on . Most recent reply
Seller Financing Deal
Hi BP,
I have not been involved much with deals involving seller financing and would love to ask for some insight from those who have. When structuring a seller finance deal and terms are set for the following example:
Seller wants to make $110k for the home
You can pay $100k but decide if the seller finances with X terms they can make $110k (or more depending on how you want to spin it).
The loan has a 30 year length with a 5 year balloon.
You flip this property and then exit within 6 months.
Wouldn't the seller be pissed at this point since you are not paying the full 5 years they would not accrue all the interest and actually net the number they had expected?
It feels like I may be missing an important piece to this strategy and would appreciate any insight on this. I know that you can structure the deal to where all interest is due upon payment, but is that what a lot of people are doing in their seller finance deals?