Making an offer to include seller financing. What should I include?

Question

I have found a motivated seller with 4 separate SFH's. She is retiring as a property manager and is willing to do seller financing. I plan on doing one home at a time to prevent from over extending myself. My question is, what do I include with the offer? I have purchased homes before, but never with seller financing. I don't want to come off as a complete newb. I was planning on submitting an informal offer over view of the terms of the purchase and loan. I was also going to include 2 years worth of tax statements as well as my current pay statements. Is there anything else I should include or anything I should do differently? I would also like to hear from anyone with 3rd party loan management experience. Upon coming to an agreement, I plan of having my attorney draft up an actual financing contract. Any advice is greatly appreciated. Thanks.

Account Closed · Answer

i would find out what the terms of the financing are,will she well 1 house and what is the price difference for all 4 houses I when then submit an offer based on your investment criteria and then submit any paperwork after an accepted agreement

Nathan Waters · Answer

Account Closed, I know she wants a 24 month balloon payment. I was going to offer 4% based on 30 year amortization with 10% down. I was thinking of trying to get something in the financing about a large jump in interest after the 24 month period. I don't want to lose the house if something gets delayed around the 24 month period. Each house would be financed on an individual basis. Once all 4 houses are under contract and rented out (currently only one is rented, 2 need rehab, one is ready for immediate move in) I could direct all positive cash flow to pay off the smallest of the 4 loans. I based on my calculations assuming very conservative numbers. I don't like surprises. Thanks for the advice.

Nathan Waters · Answer

@Steve Vaughan, I wouldn't do a land contract. More risk than I'm willing to take. I would prefer 36 months, however I think 24 months is the most she is willing to accept. I may put in for a longer contract on the second 2 properties and see if she accepts. I'm assuming there may be more incentive for her once we close on the first 2 homes and she starts seeing the mortgage checks coming in. Thanks for the advice.

Steve Vaughan · Answer

24 months is shorter than I like with that much down.  I would do that on an l/o with less down.  Also - you are probably in Land Contract-ville.  Those from a buyer's standpoint aren't any better than an option to buy anyway.  Have your attorney draft a contract that gives you title @Nathan Waters!