Barstow, CA · Member since 2013 · 51 posts · 7 votes
Hello All,
I would like to get input/strategies (that worked and that didn't) from the community on how to approach the average home owner who owners their resident free & clear to see if they would be open to seller financing.
SFR Investor · Jacksonville, FL · Member since 2012 · 285 posts · 83 votes
13y
Do they need the money now? Are they comfortable paying a Capital Gains Tax Rate of X % compared to paying their tax rate on earned income? It is all based on what their need is, right now. If they have to sell to have the money, NOW, then Owner Financing is not going to work, but you can find people, mostly with online ads, direct mail, websites, who will find you who have the need to sell and who will allow you to carry back the note. I find many multi-family owners are willing to do this, as the market here in NE Florida for Multi-family has not caught on fire as of yet.
Barstow, CA · Member since 2013 · 51 posts · 7 votes
13y
Jack, thanks for posting.
My question is geared more towards me as an investor asking a home owner who owns their home free and clear if they would be willing to owner finance the purchase, what would be the best way to approach a home owner who may know nothing about owner financing?
Investor · Fort Worth, TX · Member since 2011 · 1k+ posts · 450 votes
13y
You need to have enough knowledge on how you would owner finance a house to someone else before you can sell the idea to a seller. Otherwise, how would the conversation go?
Once you know how owner financing works (not just the general idea, but the nuts and bolts), you can walk a potential seller through the process and then they can decide if they want to do it.
The down payment and terms of the loan are all negtiable and will vary from deal to deal depending on what everyone's wants and needs are.
Thanks James, do you have any recommendations in the way of lecture, videos, etc in the way of learning the "nuts and bolts"?
Best way is to contact a title company that has a lawyer on staff that can draw up the contracts. They can tell you what all is needed and what your options are.
It is easier if you have already established a relationship with the title company (usually by means of having used them for a closing) but if you have a sure deal in the pipeline, they may talk to you about it if you take the business to them.
Specialist · Grand Rapids and Kalamazoo, MI · Member since 2013 · 391 posts · 116 votes
13y
I agree with @James H. . Often, I will discuss seller financing as an option (along with a cash sale), and explain that they can typically make more money overall, but get their payments spread out over time. For some, this is a relief, and others just want to cash out.
It helps to know the pros and cons of the different strategies, such as subject-to, lease options, wraps, etcetera. If you'd like some starting points, PM me and I will shoot you some good resources that I used in the past.
I agree with @James H. . ........It helps to know the pros and cons of the different strategies, such as subject-to, lease options, wraps, etcetera. If you'd like some starting points, PM me and I will shoot you some good resources that I used in the past.
Brandon, if you are not soliciting, why not post the information in the thread for everyone. Then everyone can discuss the tactics. :)