You don’t have to be a super investor or real estate guru to know that it’s difficult to find a buyer for your home these days. So many potential buyers have been shut out by lenders that they’ve actually shot themselves in the foot. The pool of buyers nation-wide has shrunk considerably. In your hometown for every qualified buyer there’s bound to be multiple homes available to them, that’s why they call it a “buyers market”. Savvy homeowners, Realtors, brokers and investors are now reverting to strategies from over a decade ago to sell their homes at top dollar within weeks rather than months.
The strategy is called “Owner Financing”. Traditionally to sell your home with Owner Financing you would need to have a mortgage paid in full and own the home outright. Then, you would carry a note on the terms you agreed upon with your new buyer. In short you become the bank. You carry a lien on the property and are paid according to the terms of the note until they refinance, pay you off or you foreclose when they can’t make the payments. There are great advantages to offering owner financing as you can decide the terms, the buyer and control the process. However there are some risks involved such as potential foreclosure and the liabilities that go along with lending.
Owner financing does not work for many because the majority of homeowners and home sellers have a mortgage. The only folks most of us know that own their homes outright are usually the rich, very fortunate and grandma/grandpa. For the rest of us we’re paying a lender to borrow the money in order to live in our home or paying rent to a landlord who’s paying a lender to live in our home.
Approximately 70% of America is “Credit Challenged” and have been locked out by traditional lenders from buying a home. That means the 30% who can get a loan, if they are looking to buy, are getting great deals and beating up the sellers out there. There’s typically one type of buyer called “A” credit. That’s where "Temporary Owner Financing" can be a very useful tool. IF YOU’RE SELLING A HOME FSBO, REALTOR, BUILDER OR INVESTOR, LISTEN UP…or read more intensely!!! The Credit Challenge buyer needs your help to qualify for the home. YOU CAN PROVIDE OWNER FINANCING even if you have a mortgage if you’re willing to give up a little equity on the front end. You simply sell your note at a discount to a note buyer for top dollar at closing. Most sellers are already giving up plenty of equity to even attract a living, breathing body that is interested in their home, so this shouldn’t be a shock to you. You can now offer financing to all types of buyers, not just one. B, C and D credit buyers will be flocking to your home wanting more information about your financing and what you can do for them. Not to mention all the attention will also attract “A” credit buyers as well.
Here's how Temporary Owner Financing works:
1. Find a note buying service that will purchase your note at closing for top dollar. Just Google "sellmyhomesecret" and you can come up with some.
2. You advertise your home at top dollar offering owner financing.
3. You get the home under contract with an end buyer that qualifies with your note buyer.
4. At closing your note gets purchased at a small discount and your mortgage is paid in full.
5. The new buyer now has a mortgage with your note buyer and you smile and say, “Thank you very much”.
Using this method you’ll get more written offers, quicker and at full appraised price. You may not even need to use the note purchasing service if you attract a buyer that can qualify for a sub-prime loan. In that case, you can even reduce your home price if you wish for any pre-approved buyers. And your initial offer of Owner Financing will help increase your showings thus making this a good possibility.
So, if you want to sell quickly at top dollar, here’s a strategy of becoming a solution to the problem of today’s housing market.