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Updated about 6 years ago on .

User Stats

105
Posts
79
Votes
Sid Payne
  • Longmont, CO
79
Votes |
105
Posts

Conventional mortgage or maybe seller financing on STR house?

Sid Payne
  • Longmont, CO
Posted

A quick synopsis, I have 4 short term rentals in the Disney World area. I am looking to get a 5th. I have found a house I like that would be a direct sale. The guy wants $310K and I have the down payment for a conventional mortgage. He is pretty firm but I thought I would offer him $302,500.
However, I am thinking I can save a ton of money in fees (appraisal, closing costs, etc.) if we do seller financing. I am not sure, but I think he owns it outright. If we did seller financing it would be easier for me to get to the $310K that he wants.

My lender is quoting me 5.3% on a 30yr fixed mortgage.
My question is, how hard is it to setup seller financing, would I offer him the same rate (or better) and is it worth it to go that route compared to the hassle of the mortgage process. I estimate I'd probably save a few grand by not going though a bank.
One place I would not try to save money is the inspection, that would still be a must.
Essentially, I can qualify for a mortgage but I would like to have fewer mortgages on the books for future investments and I hate paying all those fees.

Any advice?