Is owner financing a good idea for the seller?
It can be a good idea for the seller, but there are a few things to consider before agreeing to owner financing.
Owner financing allows the seller to collect monthly payments from the buyer rather than waiting for a buyer to obtain a loan from a bank. This can benefit both parties, as the seller receives immediate income, and the buyer can buy a property without going through the bank approval process.
However, there are some risks involved for both parties. For example, if the buyer stops making payments, the seller may have to foreclose on the property. Or, if interest rates rise after the purchase is made, the monthly payments may become unaffordable for the buyer.
So while owner financing can be a good option for both parties, they must understand the risks involved before agreeing to this arrangement.
Published: Oct 7, 2022
Updated: Mar 2, 2023