What Should A Seller Know About Offering Owner Financing To A Home Buyer?


If you are considering offering owner financing when selling your home, there are a few things to think about, and you may have questions. If you are interested in owner financing homes, Albuquerque trusts Sunwest Escrow - our team is always available to answer your questions.

Is Owner Financing Safe for the Buyer?


Owner financing is as safe as the terms that are written out. It is in the best interest of all parties involved to have a lawyer look over the paperwork before signing. Selling a home is a big undertaking no matter how you do it, but even more so if you are owner financing homes. Albuquerque has many neighborhoods that are in demand where seller financing may make sense for you.

How Does Owner Financing Work When Selling a House?


When you are owner financing, it is similar to how any house would sell normally, except in a practical sense, you are the bank. A contract is signed where the buyer makes regular payments to the seller, less any down payment, and it often includes a balloon payment. The balloon payment is usually due in five to ten years, with the hope that the buyer will have enough equity in the house by then to apply for a conventional loan.

Are There Closing Costs with Owner Financing?


With owner financing, not only are there no closing costs, but closing is much faster. Because you’re not dealing with a bank or other lending institution, you won’t have to wait on any approvals. This is why many people choose to seller finance; it is a much faster process than waiting for a bank or lender to approve anyone for a loan.


Who Holds the Title in Seller Financing?


When you complete a for sale by owner, seller-financed deal, the buyer holds the equitable title, and you hold the legal title. When you buy an owner financed home, think of the seller as the bank. If you default on your mortgage payments, they can probably repossess the property. Once any balloon payment is made, however, the legal title usually transfers to a traditional lender. Balloon payments are usually included in the contract for five years after purchase.

Contact Us!


Let Sunwest Escrow be your Trusted Third Party in your Owner Financed Deal. Call right away at (505)237-2225

Comments

Popular posts from this blog

DIY House for Sale by Owner: Tips and Tricks

FSBO: From the Seller’s Point of View