Can someone please explain owner financing again? There are several properties listed in my area of central TX that have owner financing options available. I simply can’t remember! I’m meeting with my realtor tomorrow to talk about other properties tomorrow.
But I was looking through craigslist and came upon lots of owner financing deals and I would love some help in understanding owner financing again. Thanks.
The seller is acting as the bank. Instead of making your payment to, say, Bank of Obama, you would make your monthly payment to the seller.
Thanks! (We’ve just had a very horrible event happen in our family and so you’ll have to excuse the painfully obvious questions that I post.)
Is this is a good option for a novice investor to get involved with?
Seller financing is good for any level of experience investor to use. If you can avoid banks, you’ll save money, aggravation, and do more deals.
Seller financed deals usually have higher interest rates than banks offer because the seller is assuming all the risk of you (the buyer) actually making payments, following through to payoff, etc. BUT you don’t have to jump through all the hoops that the banks are wanting for underwriting purposes, so it may be worth it to pay a few extra points on interest…