Funding for Down payment for Commercial retail shop
A guy that I know wants to sell me his commercial property. He’s going to retire soon. He’s willing to owner finance, but wants down payment of 150k. He’s asking price is 600k total. 

Ive mentioned a lower down payment so he wouldn’t have to pay taxes on it. But that doesn’t seem to interest him

Currently I don’t have 150k for the down payment. 

Wondering if anyone has any advice as to how I could make this deal work? Can I get a hard money loan for the 100k down payment? I’ve always heard of you can’t control the price control the terms… any ideas on how I can make this work? Or suggestions that I should bring to the seller?

Thanks
[{"id": "h9kq3bp", "text": "Contact the SBA....they will do 10-15% down loans for an owner occupied business...whether it be only the business or the business and real estate. If the property/business is in California, I can direct you to a few SBA lenders if you are looking for resources.", "replies": [{"id": "h9lk31n", "text": "Will def reach out to them. Business is in Ga. thanks for the tips!", "replies": [{"id": "h9llx6q", "text": "you're welcome. Let us know how it works out.", "replies": [], "depth": 3}, {"id": "h9owmul", "text": "You in Atlanta??", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h9ku0ic", "text": "bridge loan/mezzanine financing\n\npartners/investor group\n\ncredit cards (jk don't do this)", "replies": [{"id": "h9lk5g0", "text": "Haha. Thanks. Going to look into the bridge loan for now.", "replies": [], "depth": 2}], "depth": 1}, {"id": "h9kzprz", "text": "A bank would probably finance the property with little down if the seller\u2019s carry note is subordinated to the bank.", "replies": [{"id": "h9lk9bc", "text": "That\u2019s a good idea. Prob a smaller down payment too.", "replies": [], "depth": 2}], "depth": 1}, {"id": "h9la1d7", "text": "You can\u2026 NOT\u2026 owner finance.", "replies": [{"id": "h9ljw3g", "text": "Why not?", "replies": [{"id": "h9lk7ro", "text": "Then you don\u2019t have to worry about what amount down the owner wants.\n\nIs there a reason you can\u2019t get bank financing?", "replies": [{"id": "h9ll9i6", "text": "Ohhhh I see now. I didn\u2019t read your message correctly. \n\nYea, banks are asking for 20% down on the 600k. Which I don\u2019t have\n\nEdit* unless I haven\u2019t been talking to the right banks?", "replies": [], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h9lciwt", "text": "What are you going to do with it? Flip it? Owner/operate?\n\nIf the deal is an absolute slam dunk reposition/flip (ie., property would sell for much more after reposition), just get a partner to provide capital.", "replies": [{"id": "h9lkha2", "text": "Owner operate is the plan with this. Eventually plan to move someone else into my unit and only collect on the real estate", "replies": [], "depth": 2}], "depth": 1}, {"id": "h9lie13", "text": "Hard money = NO.\n\nWhy does the seller want 150K and not some other amount?", "replies": [{"id": "h9lkmbc", "text": "The most I could get is that he wants a decent amount in cash reserves for retirement. \n\nWhy no to the hard money?", "replies": [{"id": "h9llme6", "text": "If he wants a decent amount of money for his retirement, why isn't the balance owed (assuming he believes you'll pay it timely) which is 3 times the down payment he's asking you for as a down, adequate for his retirement? You haven't answered the question. He wants 150K for a reason. Find out the reason that 100K won't do that for him (or 50).\n\nAs to hard money; the reason you don't want to borrow hard money isn't for what it is, but for who it comes from: Hard money lenders.\n\nBanks want you to live to borrow again, hard money lenders have zero interest in future business with you. They only have an interest in today.", "replies": [{"id": "h9ln9e7", "text": "Thank you! This is great info and a great way to look at it. \n\nI\u2019m going to talk with him to try and get more info in that specific amount. \n\nThanks!", "replies": [{"id": "h9lp4xz", "text": "Ya can't offer alternatives if you don't know what his reasoning is.\n\nThe minute you know the answer to that question, an entire mountain of ideas will come to the surface that you can offer (I can think of at least 20 right now and I don't have a clue what his thinking is).\n\n(YW).", "replies": [], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h9m5ion", "text": "\\#1 - that isn't how taxes work\n\\#2 - just get your own financing", "replies": [], "depth": 1}, {"id": "h9mezhq", "text": "You need investor partners mate. Friends and family to become your equity partners. Find a way to show them that their money is secure, that you know how to manage the tenants and property and that you can pay them a nice monthly or quarterly cash flow profit after the expenses, debt service, and reserves. Even a 6-8% annual cash on cash return is attractive in this environment.\n\nPut some of your own money in as skin in the game. Legal fees, earnest money, appraisal fees etc that stay in the deal.", "replies": [], "depth": 1}, {"id": "h9mglb4", "text": "Get financing from the bank, have the owner finance (aka a second position loan) the 20% required for the down payment. \n\nOwner gets a lions share of the $$ now \n\nNo out of pocket cost to you.", "replies": [{"id": "h9pcb4f", "text": "I like the way you think!! Thank you for this!!\n\nDoes the bank usually want the down payment to come directly from me?", "replies": [{"id": "h9qtk6s", "text": "it would be sorted on the closing docs/at the closing table", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}, {"id": "h9mi121", "text": "Can you spread that down payment over a few months while you go in and operate the biz?  Put 50 down and spread 100 over 12 months, then use cashflow to lower the remaining 100.  If you end up still owing it may be for significantly less.\n\nHard money is expensive money, and generally short term.  Think 15-25% interest.  Hard money can be good to get a deal done but never good to hold.\n\nYou could try to raise some capital from friends and family as debt.  Instead of being partners you take out a loan from x amount of people at x % rate with monthly payments.  12-18 months or so. Use biz to pay for it.  \n\nRun the numbers, many options out there.", "replies": [{"id": "h9pci05", "text": "Love the creativity. These are the options I was seeking! Thank you!", "replies": [], "depth": 2}], "depth": 1}, {"id": "hb54yhd", "text": "Ideally, u need someone that can have the net worth or know people that can close deal and run the shop. Can I ask the city, state this project is in?", "replies": [{"id": "hbl8821", "text": "This is in Atlanta", "replies": [{"id": "hbmhn15", "text": "If ur credit is good enough, u can get a line of credit. And the borrow the rest or negotiate terms with the buyer.", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]