What kinds of people do you offer owner financing to? - Posted by Donna

Posted by DT (NY) on May 27, 2000 at 02:53:29:

Yes and if you are looking to cash out you can still do so with owner financing…Just hunt down some note buyers and sell the note…


What kinds of people do you offer owner financing to? - Posted by Donna

Posted by Donna on May 26, 2000 at 11:20:17:

Or do you do you NOT offer owner financing?


Re: What kinds of people do you offer owner financing to? - Posted by Craig

Posted by Craig on May 27, 2000 at 12:54:20:

Donna, it depends on what you mean by “owner financing”. If you’re talking about Lease/Option’s this generally isn’t considered owner financing. But with a buyer that has little down, and some credit issues that may take time to clear up you may want to go that route. The risk to you if that buyer quits paying their “rent” could be minimal. You could have them out and someone else in very quickly.

If you’re planning to offer real owner financing then you probably want to get a larger cash down payment, take a closer look at credit issues. You want to make sure if you have an underlying mortgage that the balance, interest rate, and term of you’re underlying note are all equal to or less than that which you are offering to you’re buyer. You want to at least consider what you will do should your underlying lender choose to call your loan due. You also want to consider what you will do should you’re buyer quit paying and you have to foreclose. It’s not something you want to jump right into without some good legal advice.

Re: What kinds of people do you offer owner financing to? - Posted by Laure

Posted by Laure on May 27, 2000 at 06:29:36:

I owner finance two types of homes: Ones that I really want to sell, but don’t want to sit on watching holding costs rise, and ones that I really don’t want to sell, but want taken care of, to receive timely payments, and would like the up front cash of option money.

the first type, I will run through a broker before I enter into a deal. I will talk with the buyer and make a judgement call as to if these people really want to repair their problems, and achieve financing and buy me out. Time frames vary from 6 months to 2 years, depending on the house, my cash needs, and the buyers.

On the second types, I want to verify their income and that they have the option money. I don’t take them to the broker, I don’t care if they ever buy the house. I give them a chance to own their own home, if they don’t exercise their option, I don’t push them into it. I don’t call them, and prod them to talk to a broker. I just collect my timely payments. So far, all have exercised their options except one.

Laure :slight_smile:

Re: What kinds of people do you offer owner financing to? - Posted by Fred

Posted by Fred on May 26, 2000 at 12:15:28:

Most of the time it is gong to be someone who has the cash for a downpayment & th financial ability to make monthly mortgage/note payments, but for one reason or another they cannot qualify for a conventional mortgage.
Their debt to income ratio might be too high for a conventional lender, they might not have enoygh time on their job, they may be self employed, may be a few blemishes on their credit report or a number of other reasons.

Owner financing opens your buyer market up considerably also. There are some buyers that just do not want to go thru all of the hassles of dealing with a traditional lender & feel more comfortable doing owner financing,since their perception is this will be alot easier & also a whole lot quicker.
Another advantage to the seller is that they are in control. If this is the buyer they want to sell to, something can usually be worked out. With a traditional mortgage the buyer & seller are on pins & needles until the mortgage is approved. If approval doesn’t take place, seller has to start process all over again.

The ones with some $moolah$… - Posted by SusanL.–Bradenton, FL

Posted by SusanL.–Bradenton, FL on May 26, 2000 at 11:30:52:


Mine had some ‘shaky’ credit issues BUT they DID have some money to put down AND they were very greatful to be given the opportunity to ‘own’ their own little piece 'o tha rock!

No regrets. I’d do it again in a heartbeat. Sometimes it’s the only way to move a property quickly.