Should You Consider Seller Financing?


Our question to answer today is, “Should I consider seller financing?”
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Today’s topic is seller financing: Is it worth considering? If you’re in a position to finance the sale of your home, it provides a great opportunity for many reasons:

1. Higher Price. Buyers are less likely to negotiate the price when they are getting special financing. You will likely get an offer at or very close to asking price. 2. It will open up your pool of buyers. Many buyers are qualified, but they, for example, might have recently moved and don’t have enough time on the job; they may be going through a divorce; they may need more time to gather funds, or they may be working toward repairing their credit. But if they have enough cash to put down, it will likely create an opportunity to attract buyers you otherwise wouldn’t have been able to—a lot of buyers are specifically looking at seller financing.


When the buyer gets better terms, they’re
less likely to negotiate the price
.



3. It will bring a better rate of return. If you were to put the money in the bank, you’d receive a much higher interest rate. You’d receive cash immediately, and you’d be able to stop the cost of carrying the home, like the costs of maintenance, repairs, taxes, HOA fees, and utilities, when the buyer purchased the home through seller-held financing. 4. You’d have a steady monthly income from holding the note. You may want to speak with your CPA to see if there are any additional benefits you could gain, but the clear benefits of seller financing are that you’ll draw in more buyers, net more money, and you’ll actually get a higher price. When the buyer gets better terms, they’re less likely to negotiate the price.

5. Stop the cost to carry. The new buyer immediately starts paying for maintenance, repairs, HOA fees, taxes, utilities, and other surprises once the sale takes place so you don't have to! If you have any questions, call or text today at (239) 248-8000. I’d love to hear from you.

What Are Your Financing Options When Buying Investment Property?


Are you thinking of buying investment property? Here’s how to get creative with your financing options.
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How do you get creative financing to purchase investment real estate? There are many ways, and here are a few tips to get started. First and foremost, look at the listing. What’s the seller’s situation and what are they willing to do? Quite often, investors in Southwest Florida who are selling a group of properties or individual properties don’t need cash and will hold a mortgage for you. This allows you to buy a home with less money down or more attractive financing terms and rates. Mortgage lenders also offer an FHA 203(k) program, which requires less money down and allows you to refinance repairs for the property, according to its after-appraised repair value. If you’d like to know more about this program, I’d be happy to put you in touch with a lender who’ll talk to you about it.



Investors who don’t need cash may be
willing to hold a mortgage for you
.



If you have friends who are also interested in buying an investment property, another option is to buy a property as a group. If you’re a part of an investment group, try presenting a purchasing idea to them and see who’d be willing to share in the investment opportunity.

Sellers who are looking for a way to attract more buyers should consider creative financing as a way to increase activity and showings. This can cause your home to sell faster and at a higher sale price, plus greater net proceeds!

If you have any questions, call or text today at (239) 248-8000. I’d love to hear from you.

The Skinny on Short Sales


If you have heard the term “short sale” before, and have been wondering what it means, today’s message is for you.
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Short sales haven’t been common in our market for many years—that is, until now. And since they have come back onto the scene, many people have been asking me to explain what, exactly, a short sale is. Essentially, short sales are a final option for homeowners under threat of foreclosure. A short sale is when the homeowner owes more than the home is worth. Banks are agreeing to release the homeowner from the balance owed and the owner is often released from the debt with no cash out of pocket. Let’s say a homeowner owes $500,000 on a property that is only worth $400,000, leaving them with a $100,000 deficiency. In this circumstance, the homeowner’s bank would search for evidence that hardship caused their inability to pay the loan. In this case, qualifying hardships include death, divorce, illness, or loss of income.



Short sales are a great way to
avoid foreclosure and get out of debt
.



Assuming the bank finds a reason to forgive the homeowner’s loan, they can then proceed to sell the home via a short sale. Make sure, though, that you receive a Release of Liability document from the bank that proves you have been excused from further payments toward your loan. There are tax ramifications for short sale sellers to consider, as well. From a buyer’s perspective, short sale properties are a great deal—as banks prefer to price such properties below market value to get them off their books as quickly as possible. Before purchasing a short sale, though, be sure to order an inspection. If you have any questions, call or text today at (239) 248-8000. I’d love to hear from you.