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Sunday, January 10, 2010

No Money Down Mortgages Available With Seller Financing

By Roy Owens

When you are planning to buy property, dealing with financial institutions can be a hassle. This is one of the reasons why some people prefer to go in for seller financing. This is useful for first time investors as well as those who have been turned away by traditional financial institutions. The interest rates are also lower and one can sell or get the property refinanced at will. There are a number of sellers who have made seller financing a kind of standardized and common process, as they take into consideration the 30 year fixed rate and give it out along with a spread on Dallas investment property.

When it comes to selling property, sellers are interested in a few objectives that they want to fulfill. For one, they want to sell as quickly as possible as they want to avoid a situation where the property sits on the market for years on end. They are also desirous of paying as little taxes as possible. When the real estate market is sluggish, one of the ways to push out a Dallas investment property and make a sale is to offer seller financing. In some cases 100% owner financing is offered while in others, sellers are open to partnering with the right buyer.

Seller financing can give sellers the advantage they need to overcome a key purchasing hurdle, opening their property up to more potential buyers. Sellers and their agents often express the attitude that the Buyer's financing is the Buyer's problem, not theirs. Perhaps, but facilitating Buyer's financing should certainly be of interest to Sellers. Sellers can also contribute up to 6% of the sales price to help cover closing costs. This allows many 1st time home buyers (or seasoned investors) to purchase a home with little or no money down.

Seller financing is able to circumvent the many issues that are related to the tests that lending institutions put buyers and sellers into. The terms and conditions have to be decided and agreed between the buyer and the seller, where up to 50-60% of the selling price is financed by the seller (sometimes more). The interest rates are generally below what banks are currently offering. There are some rules and regulations that need to be taken into account. If the property is not allowed as per the master association for the property, the seller cannot offer seller financing to the buyer.

Another example of seller financing is the seller's mortgage is transferred to the buyer and the loan extended is in the seller's name. The ownership of the property is transferred to the buyer when the sale deed is signed by the seller. Sellers also would like to avoid huge tax liabilities on their Dallas investment property and are certainly not keen on waiting for huge periods of time like thirty years or so to get some return on their investment property. All of these needs can be met by means of installment sale rather than a conventional sale. - 23212

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