How to Complete the Conditions in Offer Letter for 25% Vendor Financed Property

Hi all,

I'm in the process of finalising a creative deal to purchase an IP. I really need some help in filling up the Offer letter, especially to include financing terms.

The deal:
1. 25% vendor financed at 5% for a term of 5 years
2. Vendor pays the borrowing costs and the purchase pays it back to the vendor on settlement. (by borrowing 75%+ borrowing costs from a Lender)

Let me explain you the scenario with an example.

Purchase price:  $ 500,000
purchase costs: $   20,000
Vendor finance: $ 125,000 ( 25% of the purchase price)
Borrow from Lender: $ 395,000 (75% of the purchase price + purchase costs)

Can any of you please tell me how to write an effective and correct offer letter for such a scenario. I would like to know answers to the following questions;

1.What to put at the purchase price in the contract? (is it $500,000 or $520,000 as the idea is to borrow purchasing costs indirectly; would there be any legal issues in doing so?)
 
2. How to address the conditions for this case? Should I specifically write down all the values in the Offer letter or can I wait till the contract signing stage to go in to detail?

3. I have written up some conditions already

a.Subject to Finance.
b.Subject to Building approval.
c.Subject to vendor finance of 25% of the purchase price, at 4% annual fixed interest rate and a 5 year term.
d.Subject to vendor pay the borrowing costs, which will be settled by the purchaser on the settlement date.

Is this valid?

Please share your expertise in this regard with me.

Cheers
Don