How to find my seller-financing bottom line

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How to find my seller-financing bottom line

Tabb Pitt
New to Real Estate · Tampa, FL · Member since 2022 · 6 posts · 1 vote
Hey BP friends! I am considering selling my STR SFH (3/2 + 2/1 guesthouse) property and open to seller-financing but I'm hoping one of you experts out there can help me take the right perspective. I owe $600k on a $672k value STR (house hack 1 yr owned). Regular financing is still an option but if any of you have some thoughts on what terms make sense, I'd love to hear them. Thanks in advance!
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Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
2y

@Tabb Pitt

You should get atleast 25% down and charge atleast 9% interest as you can get 9% all day long private lending

This will essentially kill the deal for any qualified borrower so you will end up with non qualified borrowers who most likely will default in 3 years

Just sell it traditional method

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  • Wale LawalBusiness Member
    Real Estate Broker · Houston | Dallas | Austin, TX · Member since 2018 · 5k+ posts · 2k+ votes
    2y

    @Tabb Pitt

    Seller financing provides advantages like drawing in a bigger group of potential buyers, bargaining for increased selling prices, and potentially gaining interest revenue from the loan. Nonetheless, it also carries certain risks such as nonpayment, restricted liquidity, and potential legal intricacies. Essential concepts for Seller financing comprise of an initial payment, interest percentage, loan duration, monthly installments, security, and early repayment charges. Official paperwork should be prepared with a real estate lawyer, and financial examination should take into consideration interest revenue, tax consequences, and market circumstances. Seeking advice from a real estate lawyer and financial counselor can offer valuable insights and guidance in forming a Seller financing contract.

    Good luck!

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  • Chris SeveneyBusiness Member
    Moderator
    Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
    2y

    @Tabb Pitt

    You should get atleast 25% down and charge atleast 9% interest as you can get 9% all day long private lending

    This will essentially kill the deal for any qualified borrower so you will end up with non qualified borrowers who most likely will default in 3 years

    Just sell it traditional method

    7e investments53 Reviews
    WebsiteView Page
    2Reply
  • Donnie Santana
    Member since 2024 · 6 posts · 1 vote
    2y
    Quote from @Tabb Pitt:
    Hey BP friends! I am considering selling my STR SFH (3/2 + 2/1 guesthouse) property and open to seller-financing but I'm hoping one of you experts out there can help me take the right perspective. I owe $600k on a $672k value STR (house hack 1 yr owned). Regular financing is still an option but if any of you have some thoughts on what terms make sense, I'd love to hear them. Thanks in advance!

     Hey, Im interested. Shoot me a message.

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  • Bill B.
    Investor · Las Vegas, NV · Member since 2013 · 8k+ posts · 10k+ votes
    2y

    Let’s say you sell for $672 and net say $620k after selling costs? So they have to put down 7% ($52k) just so you can walk away from the house with nothing. What if they make 0-4 payments before stopping? Now you’re paying a lawyer and foreclosing on an owner occupant, not evicting someone. While you make the payments on the $600k to the bank. What if you “sell” on owner financing and the bank calls the loan due? Get a new loan and move back in or walk away with nothing? Especially if you end up going to court to foreclose. 

    What’s the upside over selling to a regular sale and walking with $20k day 1? 

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