Investor · USA · Member since 2025 · 14 posts · 1 vote
Hello All
I have a opportunity to purchase a 3 unit rental property. how should I structure the offer and what should be required in it.
Does the seller provide a fee and clear Title with Title insurance, should the seller be required to evict the tenants before I purchase, what verifications or contingencies should i include. etc......
Hey Jeff without knowing any details everything is what you are able negotiate. but you have to take in account the years interest rate and purchase price and what kind of cash flow.
I will say get a mentor if you’re inexperienced these kind of deals can go left if you really have little knowledge when it comes to structure . I spent a lot of time and money to learn how to structure seller financing deals. But good luck.
If you're lucky enough to get a free and clear property where the seller is willing to finance, this reduces much of the risk associated with seller-finance.
I would make sure the title is then moved over to your name, especially since there is not a risk of a due-on-sale clause being triggered. The seller may not want to do this, as many of these guys are benefiting from the tax deferral which comes with NOT moving title over. But you should be aware - you own nothing if your name is not on the title. This also begins YOUR title seasoning, so that when you're ready to take out a traditional mortgage, you can refinance and pay off the seller without a title seasoning issue. you can buy title insurance from the title company at closing. this is a good idea.
Seller should record their lien against the property, you both should have an attorney review to make sure all interests are property documented and protected, and i think everyone is in a good place.
as far as evicting tenants... this is up to what you and the seller can negotiate. i would still be putting on the same contingencies - appraisal, inspection... know what you're buying. don't get blinded by the seller-finance piece.