Skip to content
Innovative Strategies

User Stats

8
Posts
1
Votes
Christian Podedworny
  • Investor
  • Maspeth, NY
1
Votes |
8
Posts

How to convince seller with owner financing ?

Christian Podedworny
  • Investor
  • Maspeth, NY
Posted Jan 15 2017, 14:56

   I am trying to find a strategy that would persuade a multi family home owner to sell thier property through owner financing which would make them say YES!!

In most scenarios sellers want security through a large down payment and a quick term so that they can get thier money but I want to approach them in a way where they will be willing to go forth with the deal.

Let's say we have a deal with these numbers(hypothetical deal ) :

50 unit apartment complex 

$2,000,000 purchase price 

8 % cap 

95% occupancy at current cap rate 

C  class property at a strong rental market area 

In most scenarios the seller would like to see Proof of funds, and a pre approval from a bank to purchase this complex . At the moment I do not have the credit, down payment and connections to secure financing therefore I would structure the purchase this way :

Tell the seller I would like owner financing for a 5 year period but I am willing to pay more than asking price.

Purchase price $2,100,000

10 % down ($210,000) 

5% interest 

5 year term owner financing (balloon after 5 years and than I would secure institutional financing )

30 year amortization 

Would this entice a seller and would they be willing to go through with owner financing ?

How many of you have tried this approach to secure owner financing and has it worked ?

Loading replies...