Seller Financing Options

[Anton Taylor]

BP community,

For the past several weeks I've been researching and learning seller finance options.

Would love to hear some creative finance stories from the BP community utilizing seller financing. The market is pretty hot in my area and I'm just wondering why a seller would consider carrying the note.

Thanks in advance!

[Audrey Ezeh]

I actually just completed a seller financed deal and even though I gave them a down payment, they required none. Or rather they changed their minds...The first time I met the couple (I told my handyman to keep an ear out for landlords that wanted to sell as he worked on other properties, he hooked me up with them and I called them and invited them to lunch), they told me they want to do seller financing (it was a relief not to have to convince/talk them into it. They already knew about it and had been on both sides of the transaction. They told me they would require a substantial down payment. I didn't panic, I came prepared. As we were finishing up, I took out my last 4 paystubs and handed it to them and pulled up my >800 credit score and I could tell they were blown away. They said well clearly you don't need the money so you will pay us. I said yes I make more than enough, I just love real estate and yes you will get your money first, always.

The next day she called me and said we can do the deal and since I'm a responsible borrower and make a good income, I don't have to give them any down payment at all! I thought YASSSS!!! I'm pretty low on cash (paid my cash for my 1st duplex...never doing that again) so I'm only looking for seller financed deals where they want little or no money down. Brandon Turner always talks about an unfair advantage and my income is probably mine. 

The thing to watch out for is that some think they are doing you a favor, they will ask you to pay a premium for the property and also want a high interest rate. This couple didn't but I see them on Craigslist all the time. Seller financing does not automatically make a deal good, it still has to pencil out.

 I told them from the get go that I don't pay market value and I expect a discount and they said sure be we won't "give them away." I said no problem. The next meeting at Starbucks, I took my laptop and pulled up the BP calculators (I believe in full transparency)  and we kept working until everyone was happy with the purchase price and terms. Actually, no one was happy but we were content and comfortable with the deal.