Still, there are disadvantages that may prevent a buyer or seller from signing on for owner financing.Advantages for BuyersCan provide access to financing that a borrower may not otherwise have qualified forEnables buyers to finance homes that don’t qualify for conventional financingLets buyers and sellers shorten the due diligence period for quicker closingReduces the cost of closing by eliminating appraisal costs, bank fees and—if the buyer so chooses—inspection costsEliminates down payment minimums imposed for government-backed mortgagesAdvantages for SellersAllows owners to sell their property as-is, without having to meet a lender’s appraisal requirementsPresents an investment opportunity with better returns than most traditional investmentsShortens the selling process by reducing due diligence requirements and eliminating the lending processStill offers the ability to sell the promissory note to an investor for an up-front paymentLets sellers retain title to their home—as well as money paid toward the mortgage—if the buyer defaultsDisadvantages for BuyersOften involves higher interest rates than a traditional mortgageMay require borrowers to make a balloon payment at the end of the loan termDepending on the borrower’s creditworthiness, the seller may not be willing to provide owner financingSeller’s mortgage may include a due-on-sale clause that requires them to pay off the mortgage upon selling the house, thus precluding them from offering owner financingDisadvantages for SellersExposes sellers to the risk of non-payment, subsequent default and—in some cases—a need to initiate the foreclosure processPuts seller on the hook for repairs and other consequences of deferred maintenance if the borrower defaultsFederal law may preclude sellers from offering owner financing, limit balloon payments and require the parties to involve a mortgage loan originator.All the best!

In fact, your first year "paper losses" should be large enough where you'll have passive-losses that will need to be carried into subsequent tax years, despite having positive cash flow.

Given that an FHA loan has an occupancy requirement, after a year of living in the purchased unit, I would move out and subsequently collect a healthy cash flow from tenants.Once finished, I aim to wash, rinse, and repeat the process all over again I know this is easier said than done, but I'm going to try to get pre-approved for a loan in the next few months so I can pull the trigger when the time is right.My goal:To create a $3,000 per month passive income stream from my property portfolio in five years.Thanks for reading my post and I look forward to hearing from everyone!

Matthew,Inherent to any enterprise a question to start with might be "What are my goals?"

As you buy each subsequent rental, the cash flow really dramatically accelerates.

Subsequent to the closing, when the tax rate is fixed for the year in which the closing occurs, Seller and Buyer agree to adjust the prorating of taxes and, if necessary, to refund or pay, as the case may be, an amount necessary to effect such adjustments.

So I guess you can say I'm an enterprising college student.

I mean, if you work with one Realtor or agent on one house, are you supposed to keep coming back to them for every subsequent purchase?

Subsequent to the closing, when the tax rate is fixed for the year in which the closing occurs, Seller and Buyer agree to adjust the prorating of taxes and, if necessary, to refund or pay, as the case may be, an amount necessary to effect such adjustments.

Subsequent to the closing, when the tax rate is fixed for the year in which the closing occurs, Seller and Buyer agree to adjust the prorating of taxes and, if necessary, to refund or pay, as the case may be, an amount necessary to effect such adjustments.