MarketWatch Interview: Sellers Provide Financing
Some home sellers are lenders too
Here’s another interview that I really enjoyed. I absolutely love talking about owner financing and helping people explore their options. The above link will take you to the original article on MarketWatch.com (If it doesn’t work, read it on my site).
More and more people are wondering about creative exit strategies in today’s market, and more and more people are increasingly comfortable leaving their investment money in real estate, even at relatively low returns (6%, 7%, 8%).
News flash: The stock market and banks aren’t seen as safe havens any more <ridiculous understatement>
Some people have a hard time with seller financing, purporting that it’s “just too risky.” OK, fair enough, but what course of action doesn’t carry with it some risk?
- If you sell and carry paper, there’s the risk that you may have to foreclose on a defaulting buyer (to minimize the prospect of foreclosure, consider this land trust strategy)
- If you don’t sell, there’s the risk that your asset will depreciate, that you’re stuck in it over the next 12 years, and that any negative cash flow will eat you alive
- If you sell and put cash under your mattress, there a chance that bed bugs will gnaw it into oblivion (if they don’t, then inflation will)
- If you sit and read this post much longer, there’s the risk that you are missing the best soap opera of the year
Seller financing is a great strategy. You just need to make sure you’re informed and that you have a seller financing professional help you put your deal together. If you don’t, you are definitely risking thousands in losses and discounts down the road.