Long Beach Island New Jersey Seller Financing
Click here to search all homes for sale in the Long Beach Island NJ real estate market
Seller Financing On Long Beach Island NJ 
Seller Financing On Long Beach Island NJ 
Seller Financing On Long Beach Island NJ
Long Beach Island Real Estate
Seller financing in the LBI real estate market is a loan provided by the seller of a property to the buyer/purchaser. The seller becomes the lender, but the process isn’t as simple as it sounds. The seller will not hand over the money to the buyer in the form of a loan, but in this scenario, the seller allows the buyer to make payments instead towards the amount owed. Essentially the seller will retain an equity interest in the property, and that equity position will secure the loan made to the buyer.
By : Nathan Colmer | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com
Click here to search all homes for sale in the Long Beach Island NJ real estate market
Seller Financing On Long Beach Island NJ
Usually, the buyer signs a promissory note to the seller. This note lists the interest rate, the repayment schedule, and the default consequences. Seller financing arrangements are usually short-term. A typical deal may be a loan with a balloon payment after five years. A balloon payment refers to the repayment of all outstanding principal (balance owned to the seller) sum made at the end of a loan period.
Pros for buyers
–Seller financing allows those denied from the bank for a mortgage to purchase a home still if the seller allows this (but that can carry a risk to the seller).
-The closing process is a faster and much less expensive entry point.
-The down payment can be whatever the seller and the buyer agree upon.
Cons for buyers
-The interest you pay is typically is higher.
-Seller financing is a little less “official,” but that doesn’t mean the seller will not check your credit score. You could be turned down if the seller determines you as a risk.
You need to ensure you can pay the balloon payment at the end of the term or lose everything.
Pros for sellers
-If you’re having trouble selling your home, offering seller financing makes your home more appealing to a buyer.
-You charge a higher interest rate.
-If the buyer stops making payments, you get the house back, and you get to keep the down payment plus any money they have already paid.
-You can sell the buyer’s promissory note at any time to an investor. This would give you a lump sum payment.
-Faster sale.
-More buyers.
-Interest income.
Cons for sellers
-Typically, you will need to own the home entirely. If you still are paying a mortgage, you must get approval from your lender.
-The buyer could stop making payments at any time. If the buyer refuses to leave the house when not making payments, you will need to go through the eviction process.
-Taxes could get complicated.
Long Beach Island New Jersey Seller Financing
Seller financing in the LBI real estate market can be a simpler and faster way to sell your house in some cases. You have to be careful and make sure you are following all necessary guidelines. It does carry risks for a seller, so it is best to discuss the pros and cons with an attorney. If you are still unsure if seller financing is for you, don’t hesitate to reach out and ask us questions. If you have any questions about buying, selling or investing in the LBI real estate market, please do not hesitate to contact me.
By : Nathan Colmer |LBI Real Estate Agent | The Van Dyk Group
Cell: 609-290-4293 | Office: 800-222-0131 | ncolmer@vandykgroup.com
Click here to search all homes for sale in the Long Beach Island NJ real estate market
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