Owner Financing to Current Tenant Advice

[Leah Weisel]

I am looking to owner finance my tenant in a single family, mediocre home in PA. My tenant has poor credit, shaky job history, and will never qualify at a bank. We have made good income on the property for the past 5 years and the tenant always pays on time. We are ready to sell the property and the tenant wants owner financing, which we are strongly considering. Any specific suggestions on writing and putting a contract into action? Anyone have experience in this realm? 

[Rick Pozos]

Hey @Leah Weisel I owner finance a few properties here and there. BUT I make sure they have AT LEAST 10% down. They have to have a somewhat steady job history AND they know that they are going to be paying MORE on a mortgage than rent. Plus they know they will be responsible for all repairs(unlike renting).

If they can not save up money for a down payment, they are living beyond their means or they just dont have what it takes to be a homeowner. Some people are better off as renters. It sounds like your people are renters, NOT homeowners. 

Please learn from my mistakes where I have tried to "help" people buy a house without 10% down and steady income.

Maybe there is a reason that they will never be able to get a mortgage from a bank!!

Don't do it.