Seller Financing Details and What to Expect!
Hello BP community,
I am posting this thread to gather information on Seller Financing transactions! I am looking to gain as much information and education now, so I can prepare for this possible scenario. I am looking to gain information about the following concerns:
- My first concern with setting up a Seller Financing deal, is the tax implications that this would trigger. I have never been on the selling end of a real estate transaction but I know that most of the time there is a hefty tax bill on the sellers behalf. In a Seller Financed transaction, what can the sellers expect to pay in taxes, and when will these be due? Will they be able to spread them out? I am really not familiar with this at all, so if you guys have as much detailed insight on the process, that would be great!
- Is there anything that changes here if they were asked to carry part of the note, furthermore, would a bank require a down payment on a partial note? How difficult is this to set up?
- What kinds of contracts will need to be written up, who will they be written up by, and how much will it likely cost? These will probably be residential properties from 1-4 units to start off with.
- Should the seller use a mortgage loan originator? I don't even really know what this means or what they do, I heard it discussed briefly on podcast 123 with Justin Escajeda. What are costs here?
If anyone has any insight to the details of this process, I would be very grateful, thanks all!