What Are Advantages Of Owner Financing To A Buyer?
There is a house in my neighborhood that was fsbo. Now there is a sign in the yard that says " 10% down, owner financing, no qualifying". Would this be a good way to get into rei? I have equity in my home and a 760 credit score. Now just need a little guidance.
Thank you
I am in about the same as you - ready to go but haven't yet..
Sounds like your fsbo is a smart one too.
This might be a good one to get your feet wet but I would say the owner w/10% down is going to charge retail for the property (rent to own) - you might do will in looking for another distrested owner (someone who has to sell) to give you a better deal going in. Generically speaking you want to do 25-40% under what you can sell for even if you have to but a few bucks in you still make money.
It does depend on your goals too - good luck, I will be watching this thread for additional info from others on this forum.
Sounds like the creation of a simultaneous closing with the note being created by the home owner being sold on the table at close for a discount... Good way to sell, but that 10% down can be a killer sometimes... I roll notes that way when the need arises
Owner financed props are a great and easy way to finance for a beginner investor. I, myself, picked up 6 owner financed SFR's last year.
The real question is, as with most RE deals, is whether the deal makes sense as an investment. Are you going to flip the property or hold as a rental or what? Will you be able to make money one way or the other? Make sure that if you plan to flip that there is some equity, (doesn't sound like it but ya never know), or if you plan to hold as a rental that you have researched what similar places are renting for and figured your overall costs. If you still see positive cash, then go for it.
Regarding the benefit to buyer of a seller financed deal - no bank qualifying, escrow goes faster cause you don't have to wait for loan approval. Another general point to consider with seller financing is that this loan will not be reflected on your credit report, (point to consider if you are trying to build credit).
Good luck!
Is rent to own and lease option the same thing? Also, If you owner finance or rent to own are you allowed to put a tenent in there or are you the actual person who made the deal required to live in the residence?
~Chantelle
Hey,
In the last two years, have seen lots of ads like the one you mentioned: 10% down, No Qualifying, Owner Fiancing. I never saw them before that.
24 out of 25 times it is a Investor selling the house.
So maybe an Investor saw the FSBO bought it and now wants to sell it.