Sunwest Blog Content: What Should A Seller Know About Offering Owner Financing To A Home Buyer?

If you are considering offering owner financing when selling your home, there are a few things to think about, and you may have questions. If you are interested in owner financing homes, Albuquerque trusts Sunwest Escrow – our team is always available to answer your questions.

Is Owner Financing Safe for the Buyer?

Owner financing is as safe as the terms that are written out. It is in the best interest of all parties involved to have a lawyer look over the paperwork before signing. Selling a home is a big undertaking no matter how you do it, but even more so if you are owner financing homes. Albuquerque has many neighborhoods that are in demand where seller financing may make sense for you.

How Does Owner Financing Work When Selling a House?

When you are owner financing, it is similar to how any house would sell normally, except in a practical sense, you are the bank. A contract is signed where the buyer makes regular payments to the seller, less any down payment, and it often includes a balloon payment. The balloon payment is usually due in five to ten years, with the hope that the buyer will have enough equity in the house by then to apply for a conventional loan.

Are There Closing Costs with Owner Financing?

With owner financing, not only are there no closing costs, but closing is much faster. Because you’re not dealing with a bank or other lending institution, you won’t have to wait on any approvals. This is why many people choose to seller finance; it is a much faster process than waiting for a bank or lender to approve anyone for a loan.

Who Holds the Title in Seller Financing?

When you complete a for sale by owner, seller-financed deal, the buyer holds the equitable title, and you hold the legal title. When you buy an owner financed home, think of the seller as the bank. If you default on your mortgage payments, they can probably repossess the property. Once any balloon payment is made, however, the legal title usually transfers to a traditional lender. Balloon payments are usually included in the contract for five years after purchase.

Contact Us!

Let Sunwest Escrow be your Trusted Third Party in your Owner Financed Deal. Call right away at (505)237-2225

Original Source: https://sunwestescrow.blogspot.com/2020/01/what-should-seller-know-about-offering.html

DIY House for Sale by Owner: Tips and Tricks

If you are selling your home in Albuquerque, you may be wondering whether you should consider owner financing, or using an escrow company. The options for selling your home can be confusing, and you should weigh all of your options. 

Is Listing Your Home For Sale By Owner Worth It?

Owner financing is like any other type of financing – it’s great if the situation calls for it. Many people are nervous about putting their house for sale by owner, but there are a lot of homebuyers who are specifically looking for homes utilizing an escrow company along with owner financing. If the situation is right, owner financing is a great option! Selling your home by owner is a very similar process to using a realtor. 

What Documents Are Needed To Sell Your Home By Owner? 

Just like traditional listings, you will need a mountain of paperwork to sell your home by owner. Make sure you have all financial and legal documents in order before you list your home, just like you would if you hired a realtor. 

Do Realtors Avoid Homes For Sale by Owner? 

Realtors may avoid for sale by owner homes since they are not listed in the MLS. However, by listing their home for sale by owner, Albuquerque homeowners avoid paying high commissions and fees required when you use real estate agents. Usually, homes listed for sale by owner have a different market; entrepreneurs with generous finances are often looking for homes with owner financing since they often have difficulties getting a traditional loan from a bank. 

How Much Can You Negotiate On A House For Sale By Owner?  

One of the great things about homes listed for sale by owner in Albuquerque is that if you are a buyer, you are negotiating directly with the owner, so there is no middleman to deal with. If you are the owner, you know your bottom line and are able to negotiate your own deal. Negotiating on a house for sale by owner is much less stressful since you aren’t submitting an offer through multiple people and crossing your fingers, hoping it is enough. It cuts down on back and forth, and allows you to be confident both the buyer and seller are getting a good deal. 

Let Sunwest Escrow be your Trusted Third Party in your For Sale by Owner transaction. Call right away at (505) 237- 2225!

Original Source: https://sunwestescrow.blogspot.com/2019/12/diy-house-for-sale-by-owner-tips-and.html

Reasons to Consider Owner Financing in Albuquerque

Buying or selling a home is usually the most significant investment decision most people will ever consider, which will in most cases involve some financing options. Owner financing is an alternative to traditional mortgages. Owner financing is when a property is sold directly from the seller to the buyer with no finance intermediary like a mortgage lender or bank. Whether you are buying or selling a property, there are many cost-saving reasons to consider owner financing to purchase and sell residential and commercial properties.

Also called seller financing, the owner financing process involves the seller of the property extending credit to the buyer to purchase the property, with the buyer agreeing to make payments directly to the seller until the property is paid in full.

Owner Financing Can Benefit Both Buyer and Seller

Owner financing can be a risky option for both the buyer and the seller, but the potential upsides are worth the risk for many people. Understanding the reasons to consider owner financing in Albuquerque will help prospective property sellers and buyers make the right choices for their particular circumstances.

Whenever participating in such a large purchase, especially without the backing of a bank or other moneylender, both sides should seek legal counsel to make sure the contract is drafted agreeably in the best interests of both parties, on a short-term and long-term basis.

Benefits of Owner Financing for Buyers in Albuquerque

• Without having to wait for a financial institution to go through the lengthy and complicated application process, owner financing offers a faster closing for buyers.
• A lack of bank fees and appraisal costs will reduce closing costs.
• There are no required minimums mandated by a bank or regulations, which means total flexibility for a down payment agreement with the seller.
• Ideal alternative for buyers unable to secure a mortgage through traditional means.

Benefits of Owner Financing for Sellers in Albuquerque

• Property can sell without costly repairs that a bank would require before approval of a loan.
• It is a solid return on investment that will outperform other investment opportunities
• The buyer’s promissory note may be sold for a lump-sum payment.
• Seller retains the property title. If the buyer defaults, the seller keeps the down payment, any payments made, as well as the house.
• Avoiding the mortgage process allows sellers to move properties quicker.

Property Owners Can Trust Owner Financing in Albuquerque

A valuable tool to use when purchasing real estate, owner financing allows you to buy property without borrowing money through a money lender or bank. Owner financing can save both the buyer and the seller time and money. Both parties come together to agree on the terms of the sale and work out a payment plan until the property is paid off.

Learn More

If you are in the market to purchase property and are interested in whether owner financing might be right for you, contact a member of the Sunwest Escrow team today!

Original Source: https://sunwestescrow.blogspot.com/2019/11/reasons-to-consider-owner-financing-in.html

Things to Consider Before Purchasing a ‘For Sale by Owner’ Home

Sunwest Escrow of Albuquerque, New Mexico has been servicing real estate contracts and owner financing for over 30 years. In that time we have learned quite a bit about ‘For Sale by Owner’ home purchasing and FSBO contractual agreements. As industry experts, our extensive experience in ‘For Sale by Owner’ buying exchanges can save you time, money and the frustration of navigating this somewhat complex home-purchasing experience.

Here is some important information the team at Sunwest Escrow would like to share with you before you pursue a home that is ‘For Sale by Owner.’

Have you fallen in love with a home that is ‘For Sale by Owner’ and you’re not really sure what to do next? You might have a lot of unanswered questions about the difference between FSBOs and a home listed through a real estate brokerage firm, starting with, is this FSBO home something that I should follow up with or should I stay clear of the home all together? Buying a FSBO is just like buying any other property…somewhat. Someone will need to assume the responsibilities of the missing listing agent on the other side.

1. Is an agent necessary in a home buying situation that involves an FSBO?

The whole reason the seller has listed their home FSBO is most likely to avoid having their own agent mixed up in the home selling process. But, as a buyer, having your own agent can be extremely helpful throughout the FSBO process. If you have an agent already, they can contact the buyer on your behalf. If you currently are without an agent, consider finding one that is willing to work with FSBO contracts. Real Estate agents that represent the buyer aren’t always thrilled with the prospect of working on FSBO contracts because of the increased liability, increased work load and not necessarily increased earnings for the extra work. Finally, the seller typically pays the agent commission so why should you go at it alone?

2. What do I need to know about writing the purchase contract?

All home sales begin with a purchase contract. Writing one can be very difficult and often requires expert help. If you aren’t working with an agent and aren’t comfortable taking on the contract writing yourself, you can choose to bring in a real estate lawyer to handle that particular aspect of the transaction for you. In reality, you should go ahead and find a real estate attorney that you are willing to work with and have them assist you in making sure the entire transaction is accomplished legally and all of your rights are covered and protected. Many lawyers can draw up purchase offers and other documents for a reasonable fee, and it’s usually money well spent.

3. How do I handle FSBO home inspections?

FSBO home inspections should be handled in the same manner that any other home inspection prior to purchasing is handled. Always get a home inspection by a reputable home inspector. Deals can go bad very quickly when you are working with a bad home inspector. Make sure you ask for credentials, industry associations, and customer references. Then make sure you follow up on the information they provided you to confirm that what they are telling you is true. If a problem with the house is found during inspection you can request that the owner fix the problem, credit you the money, or reduce the sale price.

4. Should I get a ‘Title Policy’?

Some buyers think it’s not worth the extra money to buy title insurance but a smart buyer always does so. The cost to fix clouds on a title or to dispute easements can be enormous when compared to the amount it costs to buy insurance.

Things to consider when buying an FSBO Home:

• Offer less than list price.
• Write in contingencies.
• Do not give your earnest money deposit to the seller.
• Use a third party to hold deposits for you, such as a title or escrow company.
• Determine who pays for what.
• Agree upon and document when you will take possession.
• Get preapproved for a mortgage, just like you would for any other home purchase.

Are you considering buying a ‘For Sale by Owner’ home in the Albuquerque Area? Let Sunwest Escrow of Albuquerque, New Mexico facilitate your ‘For Sale by Owner’ home purchase.

Call Today for a Consultation Appointment at (505) 237-2225

Origianl Source: https://sunwestescrow.blogspot.com/2019/10/things-to-consider-before-purchasing.html

Does Owner Financing Affect Credit?

Owner Financing is Often the Best Option When Buying a New Home, Land Plot or Business Property…But How Does that Affect Your Overall Credit and Credit Score?

Sunwest Escrow, LC of Albuquerque, New Mexico is an Expert Facilitator of Secure and Safe Seller Financed Agreements. Their service of negotiating contracts, managing critical documents, and recording historical payment transactions are imperative when securing an owner-financed loan. But this is only part of the overall story associated with owner financing. So how does ‘credit’ play a part in that story?

Let’s start with the basics – What is Owner Financing?

Buying a new home, land plot, or business property is a huge investment. Given the large cost associated with the purchase, this transaction is almost always financed in some way or another. Owner financing also referred to as ‘seller financing’, happens when a home buyer is financed directly through the seller instead of a conventional bank or mortgage lender. The seller extends a line of credit to the buyer which covers the purchase of the home or property, less any down payment made by the buyer. The buyer then makes regular payments to the seller until the amount is paid in full.

If I have an owner-financed mortgage or loan, how does it affect my credit?

If you have found a home that you love, owner financing might be the answer for you. Owner-financed mortgages, however, might not end up on your credit report. Why is this?

With few exceptions, banks and traditional mortgage lenders report home and property loans as a standard monthly practice. The credit bureaus require that lenders meet certain financial standards before they can report a loan. Reporting lenders generally have to be a business, meet certain compliance measures or provide proof of the mortgage. If your lender isn’t a business, the mortgage might not be able to be reported.

That being said, if your ‘Owner-Financed Lender’ meets the credit bureaus’ minimum standards for reporting, you could be able to have your mortgage reported. Ask your lender if they are willing to fill out the paperwork necessary to report the mortgage.

Defaulting on your owner-financed mortgage can affect your credit…

Although your owner-financed mortgage or loan might not be reported to the credit bureaus, if you default on your loan it can still have a negative impact on your overall credit. By not paying your mortgage, your lender has the right to pursue your debt through legal channels and can garner a judgement against you, which does end up on your credit report. They can also turn their claim over to a collection agency and these companies are notorious for reporting to the credit bureaus.

So as you can see, even if your mortgage is not registered with the credit bureaus, defaulting on your owner-financed loan can still have serious repercussions.

The team at Sunwest Escrow, LC are experts at facilitating and implementing all of the necessary legal safeguards and contractual arrangements associated with an owner-financed loan or mortgage. Whether you are the buyer or the seller, as a third-party escrow company we work to secure owner-financed mortgages that are in the best interest of both parties involved.

Contact Sunwest Escrow, LC Today at 505-237-2225 or Email Us.

Original content posted on https://www.sunwestescrow.com/news/owner-financing-affect-credit.html