Understanding the players in an owner financed transaction makes for profitable relationships. Here we explore the four primary team members along with common industry terminology. The Owner Financing Players Seller – Note Holder - Payee The seller owns the property being sold. If they finance a portion of the sales price for the purchaser through owner … [Read more...] about Who’s on First?
Archives for July 2008
5 Reasons Sellers Offer Owner Financing
Why would a seller allow a buyer to make payments over time for the purchase of property? Here are five reasons sellers consider financing property rather than requiring the buyer to obtain a bank loan. … [Read more...] about 5 Reasons Sellers Offer Owner Financing
Real Deal #137 – Condo in Florida
Welcome to Real Deals! It’s always easier to learn from real life so here we share information from actual owner financed transactions. A developer successfully completed a nine-unit condominium building and sold one of the final units with owner financing. The purchaser had good credit but no money for a down payment. Florida Condo - Real Deal in Note Investing The … [Read more...] about Real Deal #137 – Condo in Florida
What is Note Seasoning?
“Seasoning” is the term used to describe the amount of time the payer has been making payments. The general rule of thumb is the longer the better, with 12 months or more optimal. That is not to say that a note won’t be sold unless there is a lot of seasoning. It just means the investor will be looking at other variables of the deal that minimize risk. … [Read more...] about What is Note Seasoning?
What Changes for the Payer?
"So if I sell my private mortgage note, what changes for the Payer?" This is a common question with a simple answer. Nothing changes for the payer except where they mail the payment. When a note is sold, the terms of the note remain the same. The payment amount, interest rate, and due dates remain the same. If there is a balloon payment or “bump” payments, they also remain … [Read more...] about What Changes for the Payer?
