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25/07/2017 Employment 0

The Various Means of Making a Fast Home Sale Selling properties when the real estate market is soft, there are several options and offers that are being advertised from lease option to owner financing. Propety owners understand that when there is a softening of real estate, they are also to understand that they have to consider concessions and be creative on how to sell since it has now become a buyer’s market rather than a seller’s market. Therefore, sellers are turning to some creative financing solutions in order to entice buyers, shorten listing times and create compensation for the tight credit market. The first means that sellers are offering is called the lease option where this arrangement allows the potential buyer to both lease or rent the property and have the choice to buy later on the property being rented. Usually, the potential buyer’s option money being paid is non-refundable, but a portion of the lease payments is often also applied on the selling price of the property.
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Another means implemented by the seller to attract potential buyers of the property is to offer seller financing, and this means that the seller offers to finance the whole or a part of the amount purchased by the buyer. This method is also termed as owner financing or instalment sale, where the buyer makes the payment to the seller for the agreed period of time rather than getting a bank loan or a traditional mortgage loan.
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It is also good for the seller to look at the advantages and disadvantages of these offered options. Among the advantages of the seller financing methods are that the down payment is generally greater, real estate taxes, property insurance and upkeep belong to the buyer, and since the buyer already bought the property, they act like the owner already thus care is given on the property. In this method of purchase, another pro is with regards to the greater liquidity in payments done with private mortgage rather than lease payments, and this will entice more investors to pay for cash now than future payments. The seller earns interest in the amount being financed and this is a good advantage. Compared to the eviction process which is faster and easier, the con in this arrangement is that it will take time for the seller to foreclose once the buyer becomes delinquent with his or her payments. Compared to an instalment sale, the term of repayment in this arrangement takes longer thus a big con for this method. In the lease option, the advantages are that the eviction process is faster once the buyer misses payments, and if the market appreciates, the seller could gain some upside from the increased value of the property if the buyer won’t pushes through in purchasing the property.