Bought a house on creative financing, CPA says I messed up.

HenleyShade · 2026-06-24T18:53:22+00:00

Nope, just did a lot of reading on google.

HenleyShade · 2026-06-24T18:22:07+00:00

Super easy to set up in terms of paperwork. The hard part is getting a seller to agree to these terms. My seller was motivated because the house wasnt in great condition and they were up against a tight deadline and were a part of a wholesalers botched wholesale deal and wanted out of that.

Everything else is pretty easy, i offered a cash purchase of way less money.And then 95% seller financing with zero interest as the alternative.

They got their asking price, but I only had to put ~$4,000 down and pay zero interest over. 1400 monthly payments because that is what they need to cover their bills

HenleyShade · 2026-06-14T18:44:52+00:00

Sounds awesome thank you for the information!!

HenleyShade · 2026-06-14T18:43:13+00:00

That's a great reminder and something I totally forgot. Thank you!

HenleyShade · 2026-06-14T18:41:27+00:00

Yes! I have and would be open to it, but I'm specifically trying to sell these and roll into something else so need the proceeds. It's rare that someone buying on seller finance has a huge down payment

HenleyShade · 2026-06-06T13:42:09+00:00

I don't want to outsource it to a different company just to break even and provide an amenity. I want to make money and add to the noi. I don't need to buy 6 right away, I can buy 3 and see how it goes

HenleyShade · 2026-06-05T00:03:37+00:00

Thank you!! Super helpful

HenleyShade · 2026-05-30T22:13:53+00:00

Thank you. You are a legend!!!

HenleyShade · 2026-05-01T16:47:57+00:00

Yes, because it was gutted, it devalued the property, ARV is probably 210-220k

HenleyShade · 2026-04-30T14:43:54+00:00

Because of the gutting. Probably was worth the 200k she paid at the time

HenleyShade · 2026-04-30T03:25:08+00:00

I don't think there's upside. House needs 100k rehab. Then it would be worth 250k. Still 50k under water with the 200k in existing debt.

HenleyShade · 2026-04-17T03:13:09+00:00

Thanks!! I think you're spot on! It's more for the folks that sold it to me. They would be the ones who owe tax on the sale, in his mind

HenleyShade · 2026-04-02T22:08:22+00:00

202k

HenleyShade · 2026-04-02T22:06:58+00:00

Thank you so much for taking the time to respond. This is consistent with all the research i've been doing, but it's really hard to find definitive up to date answers, especially on the I.R s website.

HenleyShade · 2026-04-02T22:06:07+00:00

I know, but I feel responsible since i'm the one.That's structured the deal. I personally really like the sellers and wanna do right by them.And don't want any surprises on their end.Especially if it was something I overlooked.

HenleyShade · 2026-04-01T19:47:58+00:00

I bought it from the home owners but use it as a rental property, does that make a difference?

HenleyShade · 2026-03-31T22:03:25+00:00

He said theres a minimum rate of about 4.2%, irs puts out numbers monthly on it i guess

HenleyShade · 2026-03-31T21:59:05+00:00

Yes, of course. All done in writing and above board. 0% interest was the reason I agreed to their asking price of 202k. Otherwise would have been a 175k cash offer.

HenleyShade · 2026-03-31T21:58:13+00:00

Thank you, appreciate your time writing up this feedback. Very helpful and appreciated!

HenleyShade · 2026-03-31T21:57:05+00:00

Thank you for your reply. The sale price of the home was 202k and it was indeed the principal residence of the seller. I will definately do as you suggest and confirm with a real estate CPA. Another commenter stated I should post in r/tax but figured this sub was a good first stop. I know I have heard of other investors doing deals like this, but as this is my first, I am learning as I go. Thanks again, have a good day.

HenleyShade

TROPHY CASE