| Seller financing, also called owner financing or subject-to loans, is ideally the most important tool for a broker, agent, or investor. With seller financing, you have two options: 1.) Do it right and close more deals or, 2.) Not structure the deal properly and see your commissions flop. Most seller financing deals turn sour because agents and investors do not properly structure the deal to protect their clients and themselves. The Pleasures and Pain of Seller Financing The obvious motivation of humans is to obtain pleasure while avoiding pain. The same can be said for investment ventures and real estate purchases. Clearly one would want to gain the most amount of money while avoiding lawsuits and losing money. But the most common mistake when dealing with seller financing is not setting up the proper investment and legal structure to make money and avoid lawsuits. If you're in agreement with this assertion, then read on because I will discuss the do's and don'ts of seller financing. It's Your Butt on the Line! Regardless if you are a private investor or an agent, there is, and will always be a huge amount of liability and risk within the real estate industry. Agents are always being sued for negligence and most of them have to do with the paper and contracts involved in the deal. And, usually the courts say the agent has liability to structure seller financing and carry-back loans in order to avoid problems and issues arising between the buyer and seller. And, most of these lawsuits involve the agent not disclosing the risks associated with this type of financing. Don't Be Ignorant! Investors nowadays are paying for the decisions they've made in the previous few years. However, most of these mistakes were avoidable ones. For seller financing to be used responsibly, there are six vital areas that need to be addressed. They are: - Content
- Terms
- Future Uses
- Structure
- Form
- Negotiations
If You Want to See Profits If you like to make money, as I'm sure everyone does, then you should be extremely interested. Let's continue into the next post by looking at these six vital areas in more detail... (Posted by K.Skowronski)
Related Articles Real Estate Investing Advice - Finding a Bargain Property to Purchase Common Myths Preventing People From Succeeding in Real Estate Investing 3 Techniques for Selling a Home at Full Price |
