Seller financing, rent to own, land contracts … these are creative ways to achieve homeownership if you can’t qualify for a mortgage. As a real estate investor here in Indy, I’ve sold a few of my rentals this way. It can be a positive route for both the seller and buyer. Laura Agadoni included me as one of her sources in the following Trulia article about seller financing. If you — or someone you know — is in the market for this type of financing, her piece is a good way to get familiar with the process:
Personally, I enjoyed giving people the opportunity to become homeowners when they wouldn’t otherwise be able to do so. For the most part, they took excellent care of the properties, knowing the home was “theirs.” I even had one family make multiple repairs and updates as they moved through their contract.
The downside was that occasionally, tragedy strikes. People get sick, lose their jobs, split with their spouses, etc. But as I stated in the article above, they usually just “bow out” gracefully and apologetically, pack up, clean up, and leave. The seller keeps the down payment, and moves on.
Bottom line? As Laura states, seller financing can work well for everyone. The seller earns good interest on the loan, and the buyer achieves the American Dream … home ownership. It’s a win/win. 🙂