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Homes For Sale In Myrtle Beach With Possible Owner Financing

Myrtle Beach Owner Financing

Homes and Condos For Sale with Seller Financing

Myrtle Beach & All Grand Strand Communities

 

Owner financing is offered on select Myrtle Beach area homes and condos for qualified buyers. Terms, conditions, and qualifications may vary and are subject to each individual owner’s discretion. Most owner’s offering financing or a lease option will require a significant down payment!

 

Buying A Home with Owner Financing

What is “Owner Financing”? It’s when the property seller becomes the bank or the lender. The seller is basically loaning you the “equity” he has in the property, providing a potential buyer with an alternative non-traditional way to finance a home or investment property

Owner financing could be a standard note and mortgage or a lease with credits and an option to purchase later, or a land contract which is like an installment sale. There are advantages and disadvantages to each form of financing, but the safest for the buyer is a traditional note and mortgage. The note and mortgage provides both parties more legal protections than other methods of creative financing.

If you are unable to obtain a conventional mortgage, owner financing or a lease option may be a good way for you to acquire a home or an investment property if …

  • You can make a significant down payment or deposit, Usually 10% to 20% but could be more.
  • You have a reliable, verifiable source of income sufficient to cover reasonable principal and interest payments or monthly lease payments.
  • You can demonstrate good character and personal responsibility

Most owners will require a background check, copies of income tax returns, credit report, business income statements or other documents to prove your good character and commitment.

The type of financing offered (if any), terms, conditions, and buyer qualifications are subject strictly to the owner’s discretion. However, the owner may be willing to negotiate on certain terms.

Do not expect an owner to provide financing unless you are a serious, committed buyer or investor with the financial resources to cover the upfront and recurring costs. Owners are risking their property and are not going to take a chance on an unqualified buyer.

Whenever considering an owner financed property, always seek expert advice from qualified legal and financial professionals before agreeing to an owner’s financing terms and conditions.

(See Selling Your Home With Owner Financing Below)

 

 

Featured Listings with Possible Owner Financing

 

 

 

Selling A Home with Owner Financing

Owner financing is also referred to as seller financing or seller carry back. It’s simply the act of a home seller becoming the lender and providing financing to the buyer. There are advantages to offering owner financing as an option when selling a home.

More Buyers

Owner financing can attract a wider range of potential buyers, including those who may have difficulty securing a traditional mortgage for issues other than debt income. For example, self-employed individuals often find it difficult to qualify for a conventional mortgage despite having the income and credit score necessary. Others may have had a foreclosure or bankruptcy that disqualifies them despite being back on their feet and meeting the down payment and income requirements. Investors with multiple properties often find it difficult to obtain another mortgage, even when they have sufficient asset equity and income.

Faster Sale

The availability of owner financing may expedite the sales process. Buyers can move forward more quickly without the need for a lengthy mortgage approval process. When interest rates are high, or the market is slow, offering financing at an attractive rate can also lead to a quicker sale.

Higher Sales Price

Sellers may be able to negotiate a higher sales price when they offer financing. You are providing a valuable service and may be able to garner a better price for the convenience.

Steady Income Stream

Monthly payments provide a steady passive income to sellers. If you need a reliable source of recurring income over time, owner financing may be a valid option for you.

Flexible Terms

You can negotiate the most favorable terms for both parties. The interest rate, repayment schedule, early pay off penalties and more are subject to negotiations. Every aspect of the note and mortgage can be tailored to benefit everyone involved

Tax Advantages

This is one of the biggest reasons to consider owner financing. You can avoid potentially large upfront capital gains taxes. By spreading the tax over time you can often lower overall tax payments.

Property Secures the Loan

Sellers have built in collateral for the loan, the property itself. Combined with a good down payment, the property provides you with additional security, further reducing your risk. In the event the buyer defaults, you have the ability to legally reclaim the property.

Handled by Attorneys

Owner financing is not a DIY (do-it-yourself) venture. The details and legal requirements of notes and mortgages are best handled by competent, experienced local attorneys.

Attorneys will prepare and record the promissory note and real estate mortgage documents. These documents will be very similar to those commonly used by commercial lenders (banks, savings and loan, etc.). They’ll meet all state and federal requirements and guidelines. The attorney will ensure the documents contain provisions requiring the maintenance of adequate hazard insurance, a “due on sale” clause, the requirement for a reasonable late charge, the right of prepayment in whole or in part without penalty, appropriate provisions regarding acceleration of the loan balance and foreclosure in the event of a default by the Buyer, and a “right to cure” clause.

Please do not try to “roll your own” note and mortgage, nor download one from the internet. One tiny detail that does’n comply with your state’s or federal laws could cost you tens to hundreds times more than the cost of using an attorney.

Sellers can also take advantage of third party mortgage servicing companies to escrow the payments and disburse the money to the appropriate recipients to avoid issues such as tax sales, gaps in insurance, and foreclosure.

Summary

Despite these advantages, it’s important for sellers to carefully consider the risks and challenges associated with owner financing, such as the potential for buyer default and the need for legal and financial expertise to structure the agreement properly. Always consult a real estate attorney and professional financial advisor when considering owner financing.

If you’re considering selling with owner financing as an option, use a Real Estate Agent who’s familiar with and experienced in closing owner financed transactions.

(See Buying A Home with Seller Financing Above)