I am interested in a park where the owner is offering seller financing. What is a ballpark interest rate I should be shooting for in negotiations.
There are no rules regarding interest rates on seller notes, and you should obviously try to get as low a rate as possible, but since conduit debt is currently running around 5.5%, I would say that a range of 5% to 6% would be good, with anything below that exceptional. But if the seller wants 7%, you are still better off with seller financing than bank debt, as it is typically non-recourse, there are no fees or legal costs, you have no credit checks or loan committee to get approval from or worry about, and the down payment is normally lower than a bank would require.