Owner Financing Advantages for the Seller

• The number of potential buyers will increase significantly.
• The sale price should not need to be reduced below the market value.
• The sale will close faster than bank financing.
• Any potential income tax liability from the sale could be deferred.
• In most cases, the note you create can be sold and converted into cash at any time.

Owner Financing Advantages for the Buyer

• The buyer will not have to meet rigid bank qualifying standards.
• The buyer may be able to purchase a property unqualified for by the banks.
• The buyer will pay lower closing costs.
• The buyer may be able to make a smaller down payment than the banks would require.
• The buyer has the option of creating flexible payment terms.
• The buyer can eliminate origination points or mortgage insurance.
• The buyer may not have to establish a prepaid escrow account for taxes and insurance.
• The best practice is to establish an escrow account for taxes to avoid a large payment by seller if the buyer cannot pay.