Owner Financed Transactions
A home is a big investment one can make, but it involves some type of financing due to its high cost. Some home buyers may find it difficult obtaining a mortgage loan because their financial situation is not ideal. There is a lot that goes into buying a home including a predictable salary, employment history with no interruptions, and a pristine credit score. As the seller, you may not only have a hard time finding a buyer, but the borrower can have trouble getting approved for a loan, which can be a lengthy process. There is another way to complete the transaction that cuts out the conventional mortgage lender or bank.
Owner financing is a financing arrangement, between the buyer and seller, in which the homebuyer finances the purchase straight from the seller, resulting in installment payments, rather than having the buyer obtain a loan from a bank. In other words, the seller extends enough credit to cover the purchase price of the home to the buyer, and the buyer makes payments until the amount is paid. Owner financing goes by many names, such as Owner Will Carry, Owner Carried Financing, or Owner Carryback; it all means the same, it just depends on where you live. There is a lot that goes in owner financing for both the seller and buyer. You might think as the buyer you could make payments directly to the seller rather than going through the process of getting a mortgage, and that’s that. These types of owner financed deals are rare. What many do not realize is that the seller has to pay off their existing mortgage before they can sell and they may not have the finances to do so. As the seller, owner financing may not be a bad idea. You can sell “as is,” retain the title, and sell your home faster since the buyer avoids the lengthy mortgage process.
Real Estate Attorneys in Wylie
While all of this can be confusing, even after doing research online, it is in your best interest, as a buyer or seller, to be sure you understand the process and your rights. And there are advantages and disadvantages both parties should be aware of when considering or engaging in an owner-financing arrangement. A qualified Real Estate attorney at Edmondson Law, PLLC will answer any questions or concerns you may have. Our staff can also assist you in drafting contracts and promissory notes when needed. Contact us by calling 972-442-8326 or visiting us at www.wylietxlaw.com for more information about our services.
Information, Not Legal Advice. We provide the information on this website as a public service. The legal landscape is constantly changing and being modified by state law and case law. As a result, we cannot promise that this information is always up-to-date and reflective of the most current jurisprudence.
We do not intend this information to be legal advice. By providing this information, we are not acting as your lawyer. If you need legal advice, you should contact a lawyer through our number (972) 442-8326 or contact another attorney of your choosing.