DEAL OR NO DEAL??

[Aryelle Collins]

I'm looking to start investing by living in a duplex and renting the other part out. This duplex is located in Tampa and the owner is willing to owner finance. The terms she offered me are:

Down payment- 15k

Loan amt- 100k

Interest rate- 5% for 10 yrs.

I will owner occupy the 1/1 but it's currently renting for 550 and the 2/1 is currently renting for 850 bringing in 1400 per month. The taxes are 923.14 and there are separate meters for utilities paid by the tenants. 

This will be my first deal and I am trying to limit as many mistakes as possible. Please give me your advice and remember I will be taking over the 1/1 after the purchase.

[Colleen F.]

Look at sold properties online.  Depends on your area how you find these this will tell you what the property is worth. Sometimes they put it in the paper, sometimes you can get it from a real estate listing database, instead of choosing for sale pick recently sold. 

Negotiate a little. Would you qualify at a bank for a loan?, I think your interest would likely be less but I could be wrong. Would there be a pre-payment penalty if you financed elsewhere at some point and paid her off?  In any case have a sales contract legally drawn up if you do this. Also find out the lease duration for the tenant you plan to have leave- if you intend to owner occupy.