If you ask the seller directly, the seller is likely to say no. Sellers often reject the suggestion of owner financing because nobody has explained the benefits or proposed owner financing as a way to sell the home. Most sellers don’t sell a home every day. Their knowledge is limited to conventional practices where the buyer goes to the bank to get a mortgage.
What is Owner Financing?
Owner financing is when part or all of the purchase price is carried by the seller, the seller is providing owner financing. Esentially the seller would be the bank and you would pay mortgage to the seller. It doesn’t matter if the property has an existing loan, except to the extent that the existing lender might have an issue depending on the bank. Instead of going to the bank, the buyer gives a financing instrument to the seller as evidence of the loan and makes payments to the seller.
If the property is free and clear, meaning the seller has clear title without any loans, the seller might agree to carry all the financing. In that instance, the buyer and seller agree upon an interest rate, monthly payment amount and term of the loan, and the buyer pays the seller for the seller’s equity on an installment basis.
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Posted via Seattle Real Estate-Seattle Homes For Sale
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