The concept of seller financing has caught on quite fast and is very beneficial to those who are planning to buy their first Atlanta investment property. It also helps those people who are unable to get a loan from the normal or traditional route. One does not have to deal with financial institutions and since the interest rates are low, you would find that it facilitates investment property purchase. It is possible to even refinance and sell as well as build credit while refinancing for lower payment. Sellers are able to take the 30 year rate and put a spread on it. Given the current real estate market sellers have made seller financing widespread and regular so the process has become quite standardized too.
Sellers want a fast closing with little hassle. Sellers also want to pay as little taxes as possible on the gains incurred. Sellers are anxious to sell; and in a sluggish real estate market, owner-financing is an attractive alternative to losing money while properties sit vacant. Otherwise, homes can remain on the market for years with owners either making mortgage payments out of pocket or renting. Sellers may consider 100% owner financing or partnering with the right buyer of Atlanta investment property for a win/win outcome.
When sellers offer seller financing to buyers, they in effect make it easier for buyers to purchase the property thus enhancing buyer interest. In these times, sellers should be helping buyers buy the property which is in sharp contrast to the opinion expressed by some sellers that financing shouldn\’t be a seller\’s concern. There are cases where sellers help in contributing 6% of the sales price which facilitates first time buyers\’ completion on the sale of their first investment property.
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 Atlanta 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.
Clark Walker uses Atlanta rental property to fund his passive income.
|
|