How to find owner financed properties?

I would like to buy owner financed properties with as little as $4,000 - $5,000 down.

I have found some on Craigslist. Other than that, my only idea is to get a realtor to ask every owner on their list if they will owner finance. I’m not sure a realtor would even do that.

Any ideas?

If you ‘found some on craiglist’ why are you resorting to agents?

Any agent worth his salt, is not going to be, as in never whatsoever, going to help you find deals that only take $4k to buy. Sell? Maybe. Buy? No.

The premise you have is good, but you might want to apply it to a different niche.

For example, I bought an upside down house for the cost of a notary ($200 after everything was signed and recorded). The seller had moved out, and couldn’t afford any negative cash flow, or risk becoming a landlord. He was more than ready for my offer as it turned out.

I made an offer to take over his loan, save him from becoming a landlord, solve his negative cash flow problems, and save/protect his credit, if he would give me the deed to his house. After some clarifying and dickering over why I wasn’t willing to give him any money whatsoever for the opportunity to take over this headache, he agreed to sign my purchase agreement, and just walk away.

This wasn’t your average upside down house. This was a beautiful, turn-key house. Within a month I had buyers for it. I was offering to finance anyone with 10% down, with no credit check. The entire down payment went into my pocket. I basically made a profit by selling no-qualifying financing.

You could do the same thing. Just look for seller who can’t sell, and give them what they want …a sale. Get their deed, promise to make their payments, and then sell the house and the financing included, to anyone willing to give you the money down you want. Why not?

Now you’re in for relatively nothing, and back out with several thousand dollars to spend. Of course, you’ve got to present yourself as a trustworthy and reliable investor with a track record of doing what you say. I think you qualify.


How might I find these desperate sellers?

The only idea I can think of is to look on the MLS for houses that have been listed for a long time.

Otherwise, I don’t think the methods of finding these deals is any different from the methods of finding wholesale deals.

Well, it gets as sophisticated and complicated as you care to make it, but the bottom line it’s the same marketing as you would do for anything. You just have to adjust the search criteria. Meantime, I pay money to get targeted sellers to call me.

From there we move forward. Stale and expired listings are fertile ground, BUT you can’t involve agents, and you really need the sellers to make the first move to call you. And the hardest part, as usual, is finding the owner of a vacant house for sale. Agents will not give you this information, and they will intercept any mail you send. So you do all the usual things to run down owners and get them to call you.

If someone was so desperate to sell, wouldn’t they list it through an agent 100% of the time?

How can I change the search criteria any more than “absentee owners?”

This sounds similar to the mass mailer you suggested sending out to apartment complexes, so it would basically include every house on the list.

You’ve got to get over the ‘all or nothing’ perspective. It’s never all or nothing in real estate. It can be more, or less, but never nothing, and never always.

You can’t think like someone with options, and then assume everyone has options.

Some sellers really need that last $10k in equity out of their house, and can’t afford to sell the house and pay an agent. So, they become FSBO’s, seller financiers, or lease/optionors. Either way, they net a few thousand more than they would normally paying an agent to sell for them.

Don’t say ‘no’ for a seller. Let them say ‘no,’ for themselves. Otherwise, you’re negotiating against yourself before you start, and putting yourself in a negative state, if not at a disadvantage. Why?

I still have no idea how to find deals.

I heard back from one of the owner financing properties on Craigslist and it would have provided negative cash flow.

Of course it won’t cash flow. That’s why you can negotiate a no down deal. It makes no sense until you force it to make sense by getting in for nothing, and getting out by lease/optioning it at a higher rent, or offer no qualifying financing with a higher price, with 10% down.

Either way you charge a premium for offering someone financing without forcing them to bend over to have their credit tonsils examined anally.

Or more simply, you make it cash flow by reselling the house with built in financing.

If the house is a dog, you finance it as a fixer with no-qual financing, and still ask for 10% down, and finance it for say 80 months. This gives the buyer plenty of time to come up with sweat equity to fix the place, make it worth more, capture appreciation, and otherwise, give you a small spread on the payments every month, and say $15,000 up front, to blow on booze and pot with your friends at the RV park. Just saying.

Would my name be on the deed to legally resell it until after I pay him his loan?

He is asking a $1,500 down payment and then financing $50,000 over 30 years at 17%.

This is a monthly payment of $712.84, plus I would have to insure the house, pay sewer, garbage, recycling, repairs if I were to become a landlord.

My plan was to become a landlord. All of your ideas involve selling the house. If that’s the only way to make a profit, then that’s what I’ll have to do, but I was more excited about landlording than buying and reselling.

From what I can tell, you are suggesting I make a profit by taking a loan out at 30 years and selling it at 80 months.

The $1,500 down payment is not the issue as to why it’s not profitable.

Also, he just said that he wouldn’t want someone to buy it, then rent it because if I didn’t pay, he would have to pay to evict these tenants. And my name would not be on the deed until he is fully repaid, therefore I don’t think I would be able to sell the house.

New strategy:

Rather than owner finance to rent, owner finance to rehab.

I had been wanting to get into rehabs as I rather enjoy doing the work at this point while I’m still young.

The sizeable down payment had been holding me back.


OKAY, so this seller is not motivated, and he’s a sophisticated investor himself, but see what he’s doing?

He’s likely over selling the price, and the interest rate, but making the terms extra easy. $1,500 to get in (cheap) and essentially an illegally-high interest rate to get out.

As an aside, his interest rate isn’t Dodd/Frank compliant.

Unless the seller was a licensed lender, he cannot charge 17% interest, period, end of story. 10% is the max without going into detail about the exceptions.

If the buyer was an investor, and the seller was a licensed lender, all bets are off.

Meantime, this is a workable model on flipping low-end houses to retail buyers (assuming the interest was 10% or less).

So, since the seller’s financing is not practically marketable to a second retail buyer, you walk away.

He bought it in February of 2015 for $24,000.

The Market Value according to the property appraiser is $19,700, but I know that houses usually sell for more than the listed market value.

He is receiving payments of about $713/month for the next 30 years or until the loan is paid off. (Financing $50,000).

Is he just looking for a sucker?

It’s not exactly “get rich quick” if you’re waiting 30 years.

Forget ‘get rich quick’. That’s for unicorn herders to obsess on.

You’re down on this, because it doesn’t work for you. However, this offer is a godsend to somebody.

Somebody’s got the $1,500. They can afford the $713/mo. payments. They can’t bend over for a credit check (probably). The seller makes it enormously, if not ridiculously easy for this low-end, credit-hiccupy buyer to own a house. This represents real value for a certain niche of buyers.

That said, the seller is probably netting $200/mo in bottom line profits, after he pays for his own overhead and/or opportunity costs …AND he just built in at least $25,000 in equity profits, that he will realize over time, if not add to his list of assets.

Most likely, any buyer won’t continue with this deal. He’ll get his credit fixed, get a better job, his grandmother will leave him $25k in her will, and he’ll go shopping for a house that costs a lot less, or just move to better opportunities.

The seller will say, “It was good doing business with you. Next!” And resell the house for another $1,500 down, 17% interest for 800 years, or whatever, and continue creating cash flow for himself.

How many $19,000 properties do you have to flip for $50,000 to create $100,000 equity profit out of thin air per year? Four?

Do four deals a year, every year, for five years, and see how fast you can create $500,000 in notes receivable for yourself.

Just the cash flow coming from 20 houses @ just $200/mo each, comes to a $4,000/mo or $48,000 annual, pre-tax income. Not too bad investing less than part time for five years.

Imagine flipping one deal a month. In twelve months you’ll have a reliable, passive income of $2,400/mo. That’s the first year. The second year it’s $4,800/mo. The third year is $7,200/mo. The fourth year it’s $9,600/mo. The fifth year it’s $12,000/mo. And that income goes on theoretically for 30 years, if you don’t do one more deal after five years. BTW, after five years it’s $144,000 of passive annual income. Chew on that.

It’s not ‘get rich quick,’ but it certainly is ‘get rich on purpose.’


Since the seller will still own the deed, I am assuming he will pay for taxes and insurance, and that’s about it. I would estimate that at $150/month on this property. Meaning that he is profiting $563/month or $6,756/year. Are my numbers off?

The only problem with trying to continue this is that you need an outside source of income to finance the purchase of additional $19,000 properties.

No, the buyer pays the taxes and insurance. And the taxes and insurance are likely not going to cover replacement of the dwelling, or reflect the retail sale price, because the seller probably is selling on a Contract For Deed, meaning he retains the deed, and the insurance, until the buyer pays him off. Standard operating procedure in most states where CFD’s are used.

No, you don’t need an outside source of anything. You need a motivated seller. I am buying half-million dollar houses, without ever producing a credit report, without getting new financing, much less proving income, and getting the deed after all is said and done. In my case, I’m giving sellers a few thousand dollars to quit their positions in most cases, but once in a while, I’m walking in for the cost of my advertising and recording fees, as I mentioned elsewhere.

Why can’t you do the same on a $19k house? Even if YOU gave a seller $1,500 to buy it, and you turned around and resold it with $1,500 down for $50k and a $200/mo cash flow, you would be into this for practically nothing, but coming out $25k richer and $2,400 a year stronger.

How are you finding these sellers?

How am I buying them for $1,500? Are they owner financing me? And then I’m going to owner finance someone else?

If someone is so motivated to sell their house, wouldn’t they just list it through a realtor?

Care to share a link to. any of these posts where you talk about this?

I can’t find it.

Never mind. I found a list.


Jay you have a lot more patience than I do today! Redstar do you realize you and Jay went back and forth with 16 posts under the heading in a single day! Redstar you need to read more, there is no easy way!


There’s what I found. Basically the same things that have been said.

My bandit signs have yielded nothing yet and I don’t think I will be ordering another batch to waste more money.

Believe it or not, not even my ad in the Thrifty Nickel has gotten me anything.