How Can Seller Financing Help You?
Are you recently self-employed and cannot qualify for traditional financing until you have that second year of tax returns on record? Are you recovering from a credit blemish that has you a year or two out from being able to qualify for traditional financing? Are you an investor looking for more ways to creatively finance properties for you portfolio? Would you prefer to purchase a home now, rather than continue to throw money away renting while you wait to qualify for traditional financing? You are in luck because we have a great option for you to accomplish your goals of home ownership NOW! All you need is some liquid cash and a savvy agent and seller financing becomes a reality for you. We have you covered on the agent front!
Seller finaning is a creative financing option for buyers like you who can afford a home but have some extenuating circumstances preventing you from qualifying for traditional financing with our great lenders at Academy Mortgage. In a seller finance scenario the seller acts as the bank and carries financing for the buyer for a short period of time (6 months to 3 years usually) and allows you to build equity while buttoning up your traditional financing down the road. You make your monthly payments to the sellers and they continue to pay down their mortgage. At the end of your agreed upon term you will finance the home and pay the sellers in full and maintain a traditional mortgage going forward. Down payment requirements usually range from 5% to 15% of the purchase price. In many circumstances, title can actually switch to your name at closing as the buyer.
This scenario is mutually beneficial for both buyer and seller. Seller financing is not right, or possible for every seller. Sellers who own the home out right, have a low mortgage payment each month, or will not be pursuing another home for a few years going forward are likely the best candidates for seller financing. Why would a seller WANT to do this though? While acting as a bank the seller gets to determine the interest rate the buyer will be paying them each month. With a little patience a seller can sell their home for asking price, or even above asking price plus an additional 5%-6% interest over the term. This can result in an additional $10,000-$25,000+ in their pockets. Sellers always maintain the rights to foreclose on the home if the buyers fail to make payments according to the agreement.
If you think seller financing is right for you as a potential buyer or seller please give us a call and we can evaluate your eligibility for free.