The rate on the money that he is holding is "negotiable". This is what needs to be negotiated between him and you. Does he have a Realtor? Do you have anyone representing you? It is really best to have someone else negotiate for you. A Realtor would be best, since a Realtor from Margate knows the area, and can show the seller "comps" of other sold properties to help you get the best price, as well as informing the Seller of various terms and rates that would be available to you without the seller holding money. As far as getting a mortgage for $200... this means that the seller would have to take 2nd place behind the mortgage company. Is he willing to do that? Don't be surprised if he wants to be in first place and expects you to not have any other mortgage ahead of his. There are other ways to come up with the $200,000. If you want to have a Realtor represent you, give me a call and I'd be glad to discuss this situation with you and represent you in this transaction. You can reach me at 800-339-JUDI (5834). Best of luck to you.