How does owner financing work?

Posted: Wed Jan 14, 2009 2:18 am Post subject:

Once you and your boss signs a owner financing agreement, you will have to make the payments according to that agreement and yes, you will be responsible for the rent, utilities and the mortgage payment to him.

gmakerley · Posted: Wed Jan 14, 2009 11:05 am Post subject:

not sure what you mean about your personal rent, wolves. can you elaborate?

I am currently owner financing my home as we speak. We drew up a contract in Word and it states how much they put down, how much they pay a month and after a year they can take the amount they paid that year off the price of the home and either borrow that amount and pay off the mortgage that I have on it OR they can continue to keep paying my mortgage til they can get better credit and afford their own loan to help their credit. They are friends of mine and I work with one of them so yes its scary and all but with the economy the way it is...I would rather make them happy and keep them in it then for them to find something else and I be stuck with it again. Its a beautiful BIG home but just not for me!!

Thanks and good luck everyone!!

-- snasteen

[Email address deleted as per forum rules]

gmakerley · Posted: Tue Apr 14, 2009 1:27 pm Post subject:

i would love to know, snasteen, if you are responding to one of the other posts on here or it this is a wholly independent posting of your own. what you have to say doesn't seem to correlate with any of the other commentaries.

i have to say that what you've written about seems like a pretty good deal for the people buying your home are getting. one other thing you can do for them is to keep a record of how they are making payments so you can add to their credit reference pile, so to speak, when the time comes for them to go and get a mortgage.

Guest

Do you know what a typical down payment is on owner financing? 20, 30, 40, 50%?
Also, a typical loan term? 5, 10 15years??
Thank you!

gmakerley · Posted: Mon Jun 29, 2009 6:37 am Post subject:

loretta, since these loans are negotiated between an owner and a buyer, i don't believe you will find that there is a "typical" down payment or loan term. a lot depends on who the borrower is - in my mind, a sensible owner who contemplates financing a purchase for a buyer would require a credit report. that is clearly going to impact the negotiations.

Guest

If I sell my house with an owner finance, and the new owners default on the note and , leave the house in degraded condition or in another scenario, the house is destroyed by fire or such, where do I stand with the morgage?

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