Seller Financing and Real Estate Agents

[Demetrio Ramirez]

Good day all! I have question regarding seller financing. Do real estate agents representing sellers for on-market deals entertain seller financing options from buyers? Is it appropriate to ask the question to the agents or is it necessary to try and find the sellers to present a seller financing option directly? Thanks for any info, answers, and opinions anyone can pass my way!

[Dave Skow]

@Demetrio Ramirez- I assume that  listing agents dont make it a point to  advertise  seller  financing  availability UNLESS they  are aware that  a buyer getting  financing on the  property will be  very  difficult or  unless the seller  prefers the income stream versus  cash ( unlikely ) ....finding a seller  willing  to carry a  private note  will be  difficult as well in this market

[Joe Funari]

@Demetrio Ramirez I can only speak for the Texas market where I work. But sure it is consistent in most states. But If I am wrong will a CA based Realtor chime in. When I am listing a property for a client and I have them sign the listing agreement. The financing section has all the financing options the seller will accept (i.e. cash,FHA, VA, and seller financing). I review each of the options for the seller. 99% of the time the sellers want the equity at the sale of the property. So they don't go for the seller financing option. If seller financing is a option the sellers are willing to entertain then when I list in in the MLS the "Financing Options Available" is an additional search feature a savvy buyers agent knows to use to ensure that their buyers are looking at properties that the seller will accept the financing they are looking for. I come across this all the time with VA guaranteed loans since I am a veteran and work with other veteran buyers using their VA Guarantee. But if the seller is willing to accept seller financing I ensure the property description includes the verbiage for the terms that the seller is willing to accept on owner financed notes. So it is very clear in the listing that is one of many options the buyers have for financing the property. I always advocate disclosing down to your underpants! I have found this strategy very successful when I am selling multifamily properties and sellers want the additional continued cash flow without having to continue to manage/maintain the property.

[Bruce Lynn]

@Demetrio Ramirez   One thing you have to understand with Realtors or FSBOs is that very few sellers can owner finance or want to owner finance.

The owner financed deals I see are normally investors and the terms are not favorable to the buyer in my opinion.....at least compared to normal bank financing.  Often a seller will want 10-20% down payment and 8-10% interest on a 5 year balloon note or something like that.   If those numbers make sense to you, then you can ask a realtor to pull a list of properties that are offering owner financing.  In my market there are seemingly very few of these, as I search for them for some buyers.   Your market could be different.

So it's not really a matter of if the realtor will work seller financing, it is the option of the seller.  I think if you make blind offers on properties with you as the buyer proposing seller financing you can spend a lot of time and effort to go no where.

[Frank Zhang]

Yes, agents do represent sellers that will consider owner financing and all offers are typically considered. There are investors where the exit strategy is to give a rent to own or a lease with the option to purchase. The terms are typically attractive to the seller with a balloon payment within 5 years. 

[Joshua Janus]

@Demetrio Ramirez One of the best ways to get a seller financed property is to either work with an agent who have a set of off market sellers or to cold call and develop relationships yourself. Seller financing is usually a result of an older investor willing to sell for the monthly income to subsidize their payments. You can end up getting a better interest rate, down payment options and overall terms if you develop a relationship with the seller.