if a seller has a apartment building he is trying to sell and offer 10 % owner financing

if a seller has a apartment building he is trying to sell and offers 10 % owner financing does that mean that i only have to come up with a 10% down payment
In Buying Property - Asked by BILLY S. - Jan 5, 2009
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Answer(s)

Chris S.
Broker/Agent
Coeur D'alene, ID

No, it probably means he is looking for 10% interest, not 10% down. However, you can always make an offer subject to the seller carrying 90% financing. 10% interest is a little high in today's market.

Jan 5, 2009
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Ranji B.
Owner/Investor
Norwalk, CA

Yes, if you're only getting 80% from the bank or some other lender. If you were able to get 90% financing, then you would basically be getting in with no money down. Just make sure that the sellers financing terms are reasonable. Sometime sellers will carry a percentage with a certain percentage down. For example, they might be willing to carry 10% with 10% down. Try asking the seller to finance a bigger percentage if not most of it. I always ask for seller financing first....Good luck!

Jan 6, 2009
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Joe V.
Owner/Investor
Plymouth, MI

I don't know. That would depend on the total amount of LTV your lender is willing to accept. If the lender is giving you a loan based on 80% LTV, and you are getting a 10% carry back from the seller, then you would need to come up with 10% for a down payment. If your lender is only going to finance 70% LTV, then you would need 20% for a down payment. If you got 90% LTV financing from you lender, then you wouldn't need any down payment. That last example was for information only...most traditional lenders won't give you better than about 70-75% LTV now. Private lenders might get you better terms though.

Jan 6, 2009
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Joe V.
Owner/Investor
Plymouth, MI

If the seller is already willing to take back 10% in financing, there are ways you can use this to get 100% financing. This would mean that your seller would actually be getting all the sale price instead of having to wait for 10% over time. You can use this to negotiate a better deal in some case too. If the seller puts up 10% instead of carrying back 10%, it works. You need to have access to someone that understands how to do this, and has access to the 100% funding source that would work with this too.

Jan 8, 2009
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terrance w.
Property/Asset Manager
Olympia, WA

I have heard of some one who offered the seller full price plus a little more to carry back a higher % so you might get it at no money down hope this helps.

Apr 25, 2009
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