Your home has been on the market for some time and you have not been successful in selling it. Potential buyers have come – and gone – and you are becoming discouraged. What can you do to sell your home?
Since your home is fully paid for and you have no mortgage, you may want to consider offering owner financing. If you decide to carry the mortgage, there will be benefits for you as the seller as well as for the buyer.
Some buyers who may have difficulty obtaining a mortgage – although they are able to pay for a loan – will likely appreciate being able to purchase a home without going through all the procedures required by a conventional lender. A classified ad that offers “seller financing” will likely entice a number of prospective buyers. The benefit to you as a seller is that if the buyer defaults, you can easily foreclose on the property since the debt is secured.
Additionally, you can probably charge the buyer a higher interest rate for this convenience. And since the deal can be closed much easier than one that involves a conventional lender, you will likely get the buyer to agree to a price that is much closer to the price you are asking.
This loan agreement can be for a much shorter period of time than that offered by a bank or loan company with a balloon payment required at the end of the agreement.
How much you decide to finance and for what period of time can be negotiated between you and the buyer with an agreement agreeable to both parties