Why would it benefit me to owner finance a property?
My husband and I want to buy a property in which we feel is listed way too high for what we want to pay. The home has been on the market for 2 years and the seller is desperate. So, they have offered us owner financing. My husband has excellent credit but we do not have anything for a down payment at this moment. Are we actually benefiting from owner financing?
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Answer by KKup
There is no benefit, if the seller is offering owner financing, that means they are trying to get you to pay more for the house than it is worth. Unless you can agree that you will only pay the appraised value of the house and you should hire the appraiser (don't let the owner hire the appraiser) or you should have both of you hire appraisers and you can compare the reports. (they should be close, but might not be identical, you could agree to split the difference).
If you don't have money for a down payment, then you should either seek out an fha loan (3% down) or wait until you have the money for a down payment.
In this market, you should never pay more for a house than it is worth. Find a house that is priced closer to what you want to (and what you can) pay.
You should make sure the documents you sign will protect you in case the owner decides he either wants the house back or he wants to be repaid quicker than originally agreed. Or if he wants to raise interest rates - you should not pay market rates on this loan, but less than that.
You should also talk to a mortgage lender about the ability to refinance an owner financed property in the future...
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