With Colorado being one of the Western states where existing home sales are down 7%, more than twice what it is in other areas, we felt it important to discuss how seller financing may make the difference between a sale and a flop.
Seller financing is the art of making one particular property stand out from the rest, simply by the fact is easier for a cash and/or credit challenged borrower to buy it, by offering to carry all or a part of the transaction amount.
The advantages to seller financing are numerous, such as:
- A tremendous increase in the prospective buying pool due to the availability of purchasing options, which has the potential of decreasing time on market.
- Buyers are less likely to negotiate price when terms are so juicy, allowing the seller to maximize their net proceeds
- With a robust, established secondary market in place, the seller can choose to sell the note to an investor. This usually involves selling it at a discount so there's meat on the bone for an investor, but you, the savvy seller planned for the discount upfront and you're now done with it.
- And more!
Seller financing can be used in conjunction with some primary mortgages, structured separately as a land contract, a lease option and...
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