how does seller finance work when I still owe on a mortgage.
Scenario:
Lets say im Listing a home for $450,000
I owe $250,000
If I want to seller finance this property, does the buyer need to cover the equity of the property?
Can I decide the interest rate on the mortgage?
Can I create a 30 year term?
I hear there’s a balloon payment involved as well in 5 years?
Honestly it’s so confusing.
Thanks in advance for your help.
In: Other
Your lender is highly unlikely to allow this. They will accelerate the mortgage and your call in your note asap. If the buyer puts down the entire amount owed or more, then you could do seller financing. Your existing mortgage is retired.
Aside from the above,
Balloon payments are more common on commercial properties but possible to include in the seller financed mortgage.
Terms are whatever the two principals write into and agree upon in the contract that is also legal.
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