Are You Using Seller Financing For Real Estate Deals Are You Using Seller Financing For Real Estate Deals

1 comment / Posted on by Steven Rivera

Are You Using Seller Financing For Real Estate Deals

Seller financing (also known as owner financing) is a concept in real estate investing that a lot of people are not familiar with. It is a great thing to be implemented because it is beneficial for everyone that is involved. 

The first thing to know about seller financing is that the subject property must be free and clear. If the property is not free and clear then seller financing is out of the picture. If you can't find a good property that is free and clear there is the option of "subject to" financing which we will discuss another day.

The next thing to know is that a great benefit to seller financing is that you eliminate dealing with the bank. The deal is strictly between you and the seller. Not having the bank middle-man the deal is good for both parties. 

So you may ask yourself the question of once you find a free and clear property that you like, what do you do? You and the seller negotiate a deal and create a promissory note that states how much money the seller is going to lend you followed by interest rates, a payment schedule, and consequences of default. You are actually setting up a mortgage, but it is with the seller, not the bank. After you negotiate a deal and the property is in your name you are ready to start rehabbing the property. 

Investor Benefits

NO MONEY DOWN!

Almost all real estate deals will require a down payment. Owner financing eliminates this because the house is already free and clear. This saves you time and hassle from searching for a lender.

Seller Benefits

MAKE MONEY!

The seller is taking the role of the lender so they are making the money on their home instead of a bank or another private money lender. This is a great opportunity to have a low-risk asset-backed investment with great interest rates, and short-term payouts. 

 

Make sure that both parties have a lawyer involved so everything goes smoothly and everyone is protected.

Reach out to us on Facebook if you have any questions or want some more information! 

 

 

 

 

Seller financing (also known as owner financing) is a concept in real estate investing that a lot of people are not familiar with. It is a great thing to be implemented because it is beneficial for everyone that is involved. 

The first thing to know about seller financing is that the subject property must be free and clear. If the property is not free and clear then seller financing is out of the picture. If you can't find a good property that is free and clear there is the option of "subject to" financing which we will discuss another day.

The next thing to know is that a great benefit to seller financing is that you eliminate dealing with the bank. The deal is strictly between you and the seller. Not having the bank middle-man the deal is good for both parties. 

So you may ask yourself the question of once you find a free and clear property that you like, what do you do? You and the seller negotiate a deal and create a promissory note that states how much money the seller is going to lend you followed by interest rates, a payment schedule, and consequences of default. You are actually setting up a mortgage, but it is with the seller, not the bank. After you negotiate a deal and the property is in your name you are ready to start rehabbing the property. 

Investor Benefits

NO MONEY DOWN!

Almost all real estate deals will require a down payment. Owner financing eliminates this because the house is already free and clear. This saves you time and hassle from searching for a lender.

Seller Benefits

MAKE MONEY!

The seller is taking the role of the lender so they are making the money on their home instead of a bank or another private money lender. This is a great opportunity to have a low-risk asset-backed investment with great interest rates, and short-term payouts. 

 

Make sure that both parties have a lawyer involved so everything goes smoothly and everyone is protected.

Reach out to us on Facebook if you have any questions or want some more information! 

 

 

 

 

1 comment

  • Posted on by Eric Ben

    Seller financing is definitely often the best, even if you have private lenders, you can often get better terms with seller financing and save those private lenders for other investments.

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