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Bob Schwartz
San Diego
real estate broker
Certified
Residential Specialist
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Creative Owner Financing
Sometimes it can be awkward if you ask a seller to grant you owner
financing to buy a home. When the seller carries a portion or the whole
purchase price less the buyer’s down payment, the seller offers owner
financing. The method of owner financing works in various kinds of markets
and is a time-tested method. There are many who want to be ahead in the
competition with other houses on the block. There are many who want to sell
their property at higher rates than the market value. There are many who
want to get a constant cash flow from their property after they have sold
their property.
There are many advantages in owner financing. It lets the customer to sell
property in good and bad markets. There is an edge in the competition in the
markets regardless of the new home construction and increased foreclosures.
These cannot lead to an influence on the customer .Owner financing attracts
moiré buyers. Creative owner financing can lead to less of price
negotiations. The customer can have a consistent flow of money after the
property is sold. This is one of the main advantages of creative owner
financing. The person makes a transition from owner to the investor when he
uses owner financing in buying real estate. Owner financing presents a
competitive advantage. The other major benefit is that it presents
consistent flow of cash after the transaction. The strategy is time tested
and it allows you to get money from the property you sold and then continue
to acquire from the transaction even after the property is sold.
The customer can settle his or her own terms in owner financing; these terms
can comprise of interest rates and terms of payment. Benefits for all the
various parties involved in the transaction can derive from creative owner
financing. In real estate owner financing the buyer of the property pays the
owner directly instead of through the bank, this way the buyer and the
seller involved in the transaction get cash flow continuously. The seller of
the property can get a very high price for the property in creative owner
financing. You can also get high interest on the monthly payment. The
methods used in creative owner financing are ideal for many customers and
often benefit everyone.
One of the difficulties of creative owner financing is the buyer does not
pay the taxes, the water bill or other such payments. If this is the case,
the government can seize the property. The buyer will have to pay the
overdue bills. The buyer may get the property back but the bills will have
to be paid by him. These are only some of the features of creative owner
financing. There are other various features but they are immaterial if these
are looked into. The advantages and disadvantages have been mentioned.
Creative owner financing is an old procedure to look at modern problems.
This makes it unique.
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