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Updated about 1 year ago,
Owner Financing Questions
As I understand it, owner financing is a way for the buyer to purchase a property, without having a bank involved. Instead, you take out a loan from the seller and pay them instead.
This leaves me with some questions:
1) Is it possible that the seller would accept a lower interest rate than the market rate? If so, why would they do this?
2) Would the seller also accept a lower down payment than 20%? If so, why would they do this, since this increases their risk right?
3) Why would a seller ever agree to this? It seems like a bigger headache to manage a loan? What are some of the dire situations they would agree to doing this?
4) Would the seller provide me monthly mortgage statements? If I wanted to pay down the principle quickly, is this possible?
5) Would I put the seller down as the mortgagee on my homeowners insurance? Would they also collect escrow for taxes and insurance?