Chapter 13 Seller Financing

Chapter 13 Seller Financing - Financing Residential Real...

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Unformatted text preview: Financing Residential Real Estate Lesson 13: Seller Financing Introduction In this lesson we will cover: how seller financing works, why seller financing is used, forms of seller financing, alternatives to seller financing, and agent’s responsibilities in a seller-financed transaction. How Seller Financing Works Two ways for seller to finance buyer’s purchase: Purchase money loan Land contract How Seller Financing Works For a purchase money loan , seller uses promissory note with mortgage or deed of trust. Purchase money loan How Seller Financing Works For a purchase money loan , seller uses promissory note with mortgage or deed of trust. I Buyer makes installment payments to seller. Purchase money loan How Seller Financing Works For a purchase money loan , seller uses promissory note with mortgage or deed of trust. I Buyer makes installment payments to seller. I Seller is mortgagee or beneficiary, with right to foreclose in case of default. Purchase money loan How Seller Financing Works For a purchase money loan , seller uses promissory note with mortgage or deed of trust. I Buyer makes installment payments to seller. I Seller is mortgagee or beneficiary, with right to foreclose in case of default. Unlike institutional lender, seller is just extending credit to buyer, not providing loan funds. Purchase money loan How Seller Financing Works A land contract is an alternative to a purchase money loan. Land contract How Seller Financing Works A land contract is an alternative to a purchase money loan. I As with purchase money loan, buyer takes possession of property, pays seller in installments. Land contract How Seller Financing Works A land contract is an alternative to a purchase money loan. I As with purchase money loan, buyer takes possession of property, pays seller in installments. I But with land contract, seller doesn’t convey title until contract price paid in full. Land contract How Seller Financing Works Seller financing may be: Primary financing I Seller is buyer’s main or only source of financing for purchase. Primary or secondary financing How Seller Financing Works Seller financing may be: Primary financing I Seller is buyer’s main or only source of financing for purchase. Secondary financing – seller second u Supplements primary loan from institutional lender. Primary or secondary financing How Seller Financing Works Seller financing may be: Primary financing I Seller is buyer’s main or only source of financing for purchase. Secondary financing – seller second u Supplements primary loan from institutional lender. I Covers part of downpayment or closing costs required for primary loan....
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This note was uploaded on 09/30/2011 for the course REAL 102 taught by Professor N/a during the Spring '10 term at City College of San Francisco.

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Chapter 13 Seller Financing - Financing Residential Real...

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