SELLER FINANCING - A way around the mortgage frenzy

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SELLER FINANCING - A way around the mortgage frenzy

Posted by Emerging Markets Group

In todays mortgage frenzy it is becoming more evident that qualifying for a mortgage loan can be complicated, and even quite stressful. This gives home buyers and real estate investors a reason to start looking for other ways to get financing on properties. There is still FHA financing, but what if you are an investor or you already have an FHA loan? In today’s market is extremely important to know and maximize the options of SELLER FINANCING.

The concept of seller financing is really quite simple. However, very few people really understand Seller Financing or how to structure a deal. Because of the demand for information, we have included a special post to meet the education demands of many. The material we have included is intended only an introduction to the possibilities of lay within the realm of seller financing. Please feel free to contact us with further questions or creative ways to structure a deal.

You may ask…WHAT IS SELLER FINANCING?

Seller Financing: A "creative financing" technique in which an owner sells property, usually real estate, to a buyer. This technique is often used if the market interest rates are too high for the buyer and the seller does not require principal from the sale. The title or deed transfers only at full payment of the loan and any foreclosure results in the property reverting to the seller. Seller financing was very popular during the 1980s when real estate values escalated. Buyers used seller financing to arrange "no money down" purchases of real estate.

Also, at some point, many people may tire of managing their own properties. They are tired of dealing with tenants and the necessary repairs. Perhaps health problems are forcing them to slow down. They want smart, safe investments that are less management intensive so they can relax, travel, and enjoy life.

You can turn your best investment into an even better one by thinking of creative Seller Financing strategies. This will allow you to turn real estate into a paper asset that is still secured by real property. If you can structure a seller financed deal properly, it can be one of the safest investments in the market today.

Here are some of the benefits of Seller Financing


You can defer capital gains

You typically get the house sold much quicker

You can allow your equity to continue working for you, often at interest rates higher than a bank would yield

Get a good cash down payment now

Create residual income without the hassle of being a landlord or property manager. Hassle free income for the term of the loan.

The note is secured by a property you personally understand and have owned.

You can often collect more on the interest than you would from renting out the unit

You no longer have to worry about maintaining the property or the tenants

Property taxes or insurance are now the responsibility of the new own

If the buyer stops paying, you keep everything and regain ownership of the property back

If you or your heirs ever need money, you can sell all or part of the note for cash

Any questions or for Seller Financing strategies please email info@investemg.com