Owner financing, whether on a farms or a home, can be a significant benefit to a buyer. When the owner finances the home for you, you're able to work out financing terms that work for both you and the owner. You can also bypass the process of working with a traditional mortgage lender to get your loan. This can be especially valuable if you have a credit or income challenge that might make it hard for you to qualify for a loan. However, you have to find the homes first.
Some multiple listing services have a special box that a listing agent can check to indicate that a property's owner will carry financing on it. Other systems may let you search for houses that have a lease option. In either case, using these features as a search option will let you identify the homes in the MLS that are correctly identified as offering owner financing. You'll have to seek out the ones that aren't flagged right yourself, however.
For Sale By Owner
When an owner is selling her own property, she may be more open to working out a different deal structure with you. Some for sale by owner properties can be found in the MLS if the owner chose to use a real estate agent to insert the property for her. In other cases, you can find them on major Internet classified advertising sites or on web sites that are designed to help FSBO owners. Driving around the area in which you're interested and looking for "For Sale" signs that aren't tied to a real estate agency can be another way to find FSBO properties.
Frequently, owners get more motivated to sell their properties as time goes on. If a property has been sitting on the market for 90 days, 180 days or even longer, you may have a stronger negotiating position. After carrying a home for a long time, the thought of getting someone to at least make a monthly payment may be more attractive to an owner than it might have been when he first listed the property for sale. As such, listings that have been sitting for an extended period can be fertile hunting grounds.
Another way to find a property that could be eligible for owner financing is to look at for-rent properties instead of for-sale properties. While not every for-rent property is owned by someone looking to sell it, some are. Those owners might have given up on finding a buyer through traditional means but could be very receptive to you if you offer a proposal to them.
Steve Lander has been a writer since 1996, with experience in the fields of financial services, real estate and technology. His work has appeared in trade publications such as the "Minnesota Real Estate Journal" and "Minnesota Multi-Housing Association Advocate." Lander holds a Bachelor of Arts in political science from Columbia University.