seller financing what to watch out for?

seller financing what to watch out for?

New to Real Estate · Salem oregon · Member since 2017 · 29 posts · 5 votes
I have someone in the area that is seller financing there home. can anyone give me some tips, dos and dont and what to watch out for. tell me about your experience with them
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Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
7y
Originally posted by @Ronald Erwin:
I have someone in the area that is seller financing there home. can anyone give me some tips, dos and dont and what to watch out for. tell me about your experience with them

 Call a title company and get a title report, open escrow, have an appraisal done, you may want to have an inspection done if you don't feel qualified, run payments through a servicing agent, reduce everything to writing in a purchase & sale agreement, make sure you know how much you are buying the property for, what the interest rate is, if there is a variable rate or balloon, the term of the financing and whether it includes taxes and insurance. That will get you started.

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  • Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
    7y
    Originally posted by @Ronald Erwin:
    I have someone in the area that is seller financing there home. can anyone give me some tips, dos and dont and what to watch out for. tell me about your experience with them

     Call a title company and get a title report, open escrow, have an appraisal done, you may want to have an inspection done if you don't feel qualified, run payments through a servicing agent, reduce everything to writing in a purchase & sale agreement, make sure you know how much you are buying the property for, what the interest rate is, if there is a variable rate or balloon, the term of the financing and whether it includes taxes and insurance. That will get you started.

  • Rental Property Investor · Oreland, PA · Member since 2017 · 51 posts · 32 votes
    7y

    @Account Closed should you do all the steps that you outlined through a lawyer, or would the title company suffice?

  • Rental Property Investor · Glendale, CA · Member since 2013 · 685 posts · 334 votes
    7y

    Mike hit the nail on the head.

    Cross all your T’s because one error can be costly.

    My biggest issue is that you make sure you are not over paying and are getting a deal on this property.

    Sometimes owner financing happens in instances where banks would not fund the deal. Although this may be area specific, but just make sure of things. 

    More importantly, make sure your contract has everything spelled out. 

    To your success!

  • Specialist · Paradise Valley, AZ · Member since 2018 · 3k+ posts · 2k+ votes
    7y
    Originally posted by @Alicia H.:

    @Account Closed should you do all the steps that you outlined through a lawyer, or would the title company suffice?

     In the Western states we use a Title & Escrow company typically. However, it is common to use an attorney on the East coast. I don't have any experience in Pennsylvania so that is better answered by someone locally. The key point is to use someone who does this type of transaction on a regular basis. Not all Title & Escrow companies will do them and not all attorneys have experience with them. 

  • Rental Property Investor · Oreland, PA · Member since 2017 · 51 posts · 32 votes
    7y

    @Account Closed thanks for your input!

  • Investor · Louisville, KY · Member since 2016 · 9 posts · 1 vote
    7y

    Ronald, 

    How did this deal turn out? 

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