Buying with Seller Finance... do you accept lower profits?

[Doug Emerson]

A local landlord that I've known for a while, finally wants to sell a 12 unit building that's in pretty good shape and fully occupied.  I haven't started the due diligence yet but I wanted to get feedback so see if its worth pursuing further based on:

The seller will finance 20% in second position to my community bank that will finance the 80% in first position.  My upfront expenses are closing costs.

Based on my handy spreadsheet and the Rental analyzer tool on BP... I'm looking to cashflow $1200-1500.  Gross rents are $7081.  Cap Rate is only 9%.

I have experience with duplexes that I pay 20% down from my savings.  And I seem to keep hitting cash flow of $250 per door.  But this 12 unit is about $100 per door.

SO... my big question:  Do I sacrifice lower cash flow per door due to the fact that this is practically no money down?

I figured in 3% maintenance and 3% cap-ex and 10% property management and 2% vacancy.

I haven't done a deal larger than 3 units, but 11 total deals so far.  I've had property management in place for 9 months.  Your feedback is GREATLY appreciated!!