Owner financing on commercial property - Posted by Fred Obik
Posted by Fred Obik on October 21, 2003 at 18:36:56:
I am an investor who recently came across a seller who is willing to carry a 20%($170,000) on a commercial property that he will sell for $850,000 using owner financing creative idea. The plan is to apply for a 80 LTV mortgage($680,000). This property will appraise for $1.1 million.
Currently,the building is partially occupied and it is bringing in $99,000 income. If I go on with the purchase,I will be paying $48,672 on first mortgage,$12,169 on the second mortgage financed by the owner. Utilities/year = $6000/ yr,Taxes = $22,000/ year. Yearly cash flow = $10,159.00
Please,do you think this will be a worthwhile venture? What will be an alternative method of acquiring this property? Any advise will be appreciated. Is it possible to refinance the building immediately after purchase and pay off the seller?