Help Analzye this deal w/ seller financing
Hi everyone! I'm a new REI looking at getting into multi-family rental properties here in Phoenix. I started looking into some properties and found some with seller financing options. I found 2 properties with the same owner. I had contracted the commercial broker helping with the sell listings. He told me the owner is asking 19% down with seller financing however, then he told me the owner is open to any type of deal within reason. He said to come up with some options and email him my terms. I would love for you to help analyze my deal to see if it's good to even get, and then after listening to many numerous episodes and other investors on how they did their deals, I'm hoping maybe asking for a $0 down deal (no money down or little money down) option I can present! I have the outlook that the worst the owner could say is no right?!
Here is the 1st property : $349k - 2 units (3/2, 2/1) On this property the lowest interest rate would be 6.5% because there is a mortgage on it at this rate.
These are his "actual summary"
Gross Annual rent is $22,332.
Vac Loss $1,116.
Effective Gross Income $21,216
Property Taxes $990
Operating Expenses $5,238
Total Expenses $6,228
Net operating Income $14,988
The 2nd property is $495k - 3 units (2 -2/1 & 1bdrm)
These are his "actual summary"
Gross Annual rent is $35,820.
Other Income $600
Vac Loss $1,791.
Effective Gross Income $34,629
Property Taxes $2,245
Operating Expenses $6,528.00
Total Expenses $8,773
Net operating Income $25,856
My thoughts were to do seller financing for 12 months to 18 months, then purchase the property through a conventional loan. If I did a loan similar to a HML for the first 12-18 months would that be worth it? I'm not sure if I would be in the hole or if there would be a cashflow coming in for me on top of the mo premium to the owner? All suggestions, input, and advice are welcome.