Appraisal issue - creative financing

3 Replies

Hi,  I found a 4plex for $300K with good cap rate. I am able to put up to 25% down (which is what the bank is asking) but the seller is only considering cash offers due to appraisal not going through at the current price in previous deal attempt. They are not willing to sell at appraisal price.

Anybody with similar experience and how to overcome? I am thinking of creative financing options, maybe proposing a seller financed deal? I have never done that before so looking for advice on how to approach and structure similar deals. Thanks!


I am not sure why anyone would want to buy something that will not appraise nor put up that much down payment, but if you really want to move forward with this have the seller hold a 2nd mortgage for the difference.

I don't know all your numbers regarding positive cash flow, but its not a deal I would be excited about.

Best of luck to you,


Thanks for the feedback, Jim. The appraisal seems very conservative. The cap rate is right around 8% (with very conservative estimates for expenses), Actual should be even higher. I guess I'm curious about the actual logistics of seller financed deal (I have 0 experience in that area :-)).

  • What do you present the seller with?
  • What kind of contracts are available for this type of deal?
  • What are the benefits to the seller? (beyond getting the price he wants and getting some cashflow & return on his money). Not knowing me (the buyer) it seems like this would be very risky from his perspective.
  • etc.

Yea, doesn't seem like a find. Man I want to sell you houses.

As long as its not like an fha or va deal where the appraisal stays in system for 6 months just offer to pay for the next appraisal.

Do you REALLY want to buy it if both appraisers agree your over-paying. If you need to sell it do you want to be in this guys position? 

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