I see alot of homes that say 100% owner finace. What does that meen. Some say no banks.
2007-12-02 11:32:36 · 4 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
When you see a sign such as this it simply means that the person that own the house will sell you the property with no money out of your pocket. Normally this is a real estate investor trying to get rid of a piece of property so he/she will not lose any equity build up in the property.
Some might be home owners, but these are normally investors selling investor property.
Most of the time there is a first mortgage on the property and the seller is carrying a second mortgage to cover the difference between what is owed on the mortgage and the sale price of the property.
You will pay directly to the owner what ever the sum of the two mortgages are, the seller will then, in turn send the 1st mortgage whatever is owed on the first and keep the remainder for himself.
An example would be. If the first mortgage payment is $850.00 per month and the second mortgage comes to a total of $275.00 per month, then each month your monthly mortgage payment will be $1125.00 per month. The $825.00 each month will be forwarded to the first mortgage holder by the seller and the seller will keep $275.00 for his owner carried second mortgage.
You will have to cover your closing cost since the seller will be carrying the mortgage. This is negotiable, so you might ask if the seller will cover your closing cost.
Most of the time there is little or no qualifying for these type transactions. So if you have dings or bad credit you might qualify for a deal such as this.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-12-02 13:58:46 · answer #1 · answered by loanmasterone 7 · 1⤊ 0⤋
The owner of the property would become the bank if you were to purchase the property. instead of going to a regular mortgage company and putting 10 - 20 % down, the owner is willings to forgive a down payment in leui of getting a buyer quickly.
2007-12-02 12:16:01 · answer #2 · answered by ? 1 · 0⤊ 0⤋
It means the owner is willing to hold a mortgage on the property. He would be the bank instead of a normal lender.
2007-12-02 11:49:43 · answer #3 · answered by healthspot_2000 4 · 0⤊ 0⤋
it means that you do not need a down payment, they will finance the whole amount of the loan.
2007-12-02 11:49:22 · answer #4 · answered by Fire's Shaddow 5 · 0⤊ 0⤋