BiggerPockets

I am a young real estate investor thats looking for his first deal.
Although iv tried reading different articles on this topic, i still find it very difficult to understand how owner financing works... i see the term 'own carry mortgage' many times - word around town is that you can get deals with little down payment? then what happens?

If anyone here has this field as a concentration in their investments, i would appreciate some info

thanks

Owner financing just means the original owner takes the place of the bank. Instead of having to go get qualified through a bank, the owner accepts payments and obtains all the glory and problems that come with it.

For the most part owners are more flexible than banks.
Means less money down and more room for negotiations. If you were really motivated, you could amass a whole empire of real estate by obtaining homes for no money down by owners who are desperate to sell and will allow you to take them off their hands cheap.

Originally posted by Emil Aghakian

I heard somewhere that basically the owner will give you the deed with no money down and what you do is just pay his rent... that seems stupid so I may be wrong

Very much possible. You're not technically paying his rent, I assume they're talking about paying his mortgage. This is called taking over the property "subject to" the mortgage.
There's a ton of info regarding this topic if you do a search on this site.

and then there are companies like mine who buy the financing notes carried back by sellers which can provide them more cash from their sale. BTW Sellers would be foolish to give you a deed with no money down. No money down deals are very rare and typically require additional property for security or some other arrangement that secures a seller's interest in the property being sold or secured by some other method. Think about it. Why would a seller give up a property of any value and risk losing it all by selling it with zero down to a buyer who would have absolutley nothing to lose. Nearly all real estate deals require some cash if not for down payments for transaction costs and carrying costs. Money is what greases the squeeky parts of a real estate deal to make them flow properly. Once in a while someone does make a no cash required deal but you could spend years trying to find one that works for the parties involved. I have been buying and investing in real estate since 1962 and have yet to see a no-cash deal that made any real sense.