Too good to be true? 4-plex, Hard Money,

BP nation, 

Got an off market 4-plex. Brings in $3200/month, and in Great condition. New AC/s, tile, etc. Previous owner kept it in immaculate condition. 

Market value right now is about $320K, I can get it for $250K. 

Now, I have a hard money guy lined up willing to loan me $250K, at 5% with a 20 year balloon. Seems almost too good to be true. $610.77 monthly payments (interest only). 

End game is to hold it for a few years, let it cash flow, and then either sell it or do a cash out refi. 

1. Has any body ever heard of hard money loans at this rate? The guys is out of New York, and the contract looks legit (havent signed). If anybody has had bad experiences with similar terms, PM and I will let you know who the lender is. 

2. Bank will refi after seasoned for 1 year. Would you sell at market value and get the approx $70K in equity, or let is cash flow until depreciation is exhausted? 

3. Quick nickel or the slow dime?

Any insight/experiences with something like this would be greatly appreciated!