Why You Should Consider It
Today on Houston area MLS there are more than 37,000 homes for sale (as of Oct 2010). Less than 2.5% offer owner financing. ELIMINATE 97% of the competition with owner financing. There are FAR more buyers looking for owner-financed homes than there are homes available. This enables you to sell at full market value, sell faster with less cost and with less overhead.
Benefits of Selling via Owner Financing:
- Sell for Top-of-Market Price – Maybe at a Premium!! No more discounting.
- Sell Much Faster – 3-6 weeks to contract instead of 5 months for conventional. Close in 10 days instead of 30-60 days with conventional financing.
- Sell With Far Less Closing Costs – No seller contribution to buyer closing costs, reduced realtor costs, reduced repairs, etc.
- Sell With Less Carrying Costs – Eliminate note payments, lawn expenses, water, electric, trash and gas bills, vandalism, theft, etc.
- Short Term obligation – You can cash out after 2-3 years!
Why Owner Finance??
Buyer’s use owner financing for a variety of reasons but the most common is an inability to qualify for a traditional loan. This could be for several reasons, one being the buyer has cash on hand for a down payment, has good and steady income, but a low credit score. By using owner financing you by-pass the bank and the seller becomes the lender. In addition, a bank can take 30 or more days to close. With owner financing, you can close in just a few days!
I see the benefit of Owner Financing but I don’t want to be a long term lender. How do I cash out?
The key part of what is done is reporting the buyer’s mortgage payments to the credit bureaus. This NEW, MAJOR trade line has a strong impact on the buyer’s file, driving their credit score UP. Once they reach a qualifying score, they refinance. The seller gets full payoff without having to discount the note for sale. The buyer gets a low FHA rate and his payments drip significantly. Everyone WINS!!
Owner Financed Transaction vs. an FHA Transaction:
The Fine Print
*FHA Seller Contribution to Buyer Closing Costs. Not paid with owner finance
*Excessive repairs reduced or eliminated with Owner Finance
*Holding Costs at $100/mo for 5 months. Owner Finance is positive cash flow – 12 months at est $200/mo.
*Prime Loan Fee (contact us for details)
If you are interested in learning more about Owner Financing contact us today! ChrisWylie@countonchris.com.customers.tigertech.net or 281-583-9393