In general is there any benefit to providing a tenant a loan/mortgage to buy a property rather than selling it and generating income from note finance or the stock market? Have any of you provided a mortgage to a tenant?
My specifics: a tenant fell behind and I did not evict him. He is now paying regularly more than the rent to slowly repay the outstanding. I will be moving and am considering selling. If I sell to a third party I doubt the tenant will pay back the outstanding. If I sell him the property we can add the outstanding to the capital sum.
Thank you for any comments. Konrad
You could wait until he's paid everything back and then sell. If the tenant is unable to pay rent, he's probably incapable of qualifying for a traditional mortgage. If banks won't lend to him, why would you? That sounds like you're asking for trouble.
Get him caught up or get rid of him. Then list it for sale on the open market and sell it to people that can pay their bills.
I don't think there is any benefit to the LL except spreading your capital gain over time? I have had tenants ask in the past but I don't see it as any benefit to me. Properties are hard to find and always take extra dollars and work in the beginning.
I certainly don't see any reason to give this tenant any breaks!
Nayhan and Bjorg, thank you for your replies. I was starting to think along similar lines.