Go Creative Financing or Just Buy?

[Jared Emerick]

Hello,

Went to a home today with a very motivated seller. It seems the priorities at closing are that they would like some cash at closing (<$2,000), and if to make deal sweeter, will carry a note until final sale of home by me. 

I can't seem to get down to detail how I want to do this deal so I am reaching out to BP. 

Conservative Home Value: $48,000-$55,000 (could be more, the home is in a small town where comps are nearly impossible to find, This estimate is based on trulia, realtor, and zillow). 

Rehab needed: about $5,000. 

Mortage: $36,000 balance (terms: 30 years @ 4.5%; 28 years remaining, $377/mo is principal, interest, taxes, and insurance)

Other notes: the seller is ready to move because of a broken relationship and moving away for a job. Wants to close ASAP. The seller is ok with a "subject to existing financing" purchase (with some money at closing), or a straight buy (where I would have to use a HML.) The home will rent from $750-850/mo.

I guess it's tough to figure out how to buy this home because I am unclear about how I want to exit. Other area investors say 2/1s in the area are difficult to sell quickly, are are better as long term rentals here. But i would like to be able to cash out of the property in about 24 months ideally.

My thoughts: Assume the mortage, owner finance the property or lease option the property as an exit. This will cost me <$2,000 upfront to close the deal. And I would have the home around $43,000 (36,000 loan+2,000 at closing+/- $5,000 for light rehab)

Can anyone experienced with seller financing offer advice or would you offer suggestions on buying the home outright through hard money at 5 points/15%, interest only loan. 

Any thoughts and opinions are appreciated. Thank you very much.