Flipping with owner financing

3 Replies

I have a seller who is dramatically overpriced for his listing (on the MLS for 300 days when the market average is 65). The house needs a lot of work and I am willing/able to do it. I am thinking the win/win may be for him to hold paper on the property with a 6-12 month option. However, I am not sure how I could then sell the home and make a profit on the back end. Is it common/possible to use owner financing for a flip or do I need to use private money and just buy it at the price that works for my numbers? I own Anson’s book, but seem to have misplaced it at the moment...


If it's overpriced walk, nay, run away. If the numbers don't work (which is what I am guessing you mean by overpriced), then they don't work, owner financing or not.  

Reminder: The day you get into the deal is the day you get out. 

You can't overpay for a property and have "seller financing" save your keister. Seller financing only works if the deal works with it. Put another way, seller financing makes a deal work. If you use seller financing,  then the seller is your private lender or bank. It doesn't make any sense to have the seller hold paper if the numbers don't work. 

Run your numbers, and stick to them, asking the seller for financing that makes your numbers work. The seller can gather the interest you would usually pay to the bank/HML/private lender. That is the advantage for the seller, they make extra money by being the bank, which increases the amount they get for the property.

Hope that helps. 

Good luck, 


@James C. I agree whole heartedly. I was thinking owner financing may make the deal more attractive to the seller AND get the numbers where I needed them. 

Thank you for clarifying. I appreciate the help. I wasn’t sure how to close the deal once the house was renovated. 

I am learning thanks to the help of friends like you!

Hi Mark, I agree with Jim. If the numbers do not make sense it doesn't matter what type of financing is in place, you make money when you buy not when you sell. Hope this helps :-)

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