Owner Financing is when an owner of a property participates in all, some, or gives the option for the purchase of a property for a buyer. Owner financing is also known as owner will carry, owner financed, and owner will carry note. There are really three main types of owner financing and I give you an in-depth analysis of each in my book, but for a great overview of the three most common please view below:
Contracts: Land Contract, Contract for Deed, Deed For Title
This form of financing by the seller has many benefits for the buyer and seller alike. A a buyer your right to the property is secured by a contract that you have with the seller of the property. This contract should include all the agreement and terms of transfer between the buyer and seller.
Lease Option, Rent to Own, Rent to Buy, Lease to Own
While not a full form of owner financing a lease option or rent to own is a great way to get some of the benefits of financing. Rent to own has become a popular way for many owners to sell their property given the current real estate market. In my book I give you many tips and pointers you will need to know if you are considering buying a home on a lease option. A lease option is a great option if you lack a larger down payment often required by contract type financing or can’t obtain financing for a owner carry back explained below.
Seller or Owner Carry Back
A seller carry back typically requires you to have some decent credit. Most seller carry backs involve the buyer obtaining a first mortgage and asking the seller to carry back a second or even third mortgage. In my book I go in detail on what forms of carry backs are most common, how you can find carry backs, and why an seller carry back is one of the best forms of owner financing.
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