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Updated 8 months ago,
Owner Finance Deal. Good or Bad?
I was thinking about owner financing a property to a buyer and I need some help please to figure out if this is a good deal or not.
I paid $235,000 for the home. Here would be the terms with the buyer:
Sales Price: $315,000 (NOT worth this. Probably worth about 260k)
Down payment: $100,000
Interest rate: 6.75% (option to raise rate in 3 years but not down)
Loan Term: 30 years
Buyers monthly payments: $1,394.49
When I crunch this into Chat GPT is says I am getting a 271.87% ROI. Which over 30 years is about 9% (at least I thought)
It then gives me an annualized ROI CAGR of only 3.1%??? Which sounds horrible.
Please let me know your honest thoughts!!!