A person buying a home using seller financing does so for the obvious reason: the seller of the property is willing to take the purchase price for a period time. What often is missed is there are other advantages for the home buyer. They include the following:
· No costly loan fees
· No private mortgage insurance premiums
· Less restrictive underwriting including…
a. Down payment
b. Credit scores
c. Proof of income
d. Self employed income
The bottom line is that seller financing is easier, faster, and less restrictive than traditional bank financing for a home purchase. Though the home seller will usually pay more in interest over the term of the loan, they will probably pay less in out front costs. Once the home buyer establishes a good payment history and improves their credit score, they can probably refinance at a lower rate. Best wishes in all your real estate pursuits.- RLW