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Sunday, August 16, 2009

Owner Financing - Safe and Easy

With today's economy and the lack of trust in our banking systems, people are increasingly offering and taking advantage of owner financing. It is a system that has become more and more interesting by the day. Many people are afraid to trust lenders, and lenders are afraid to trust potential home owners, in comes owner financing. Owner financing is a safe and easy way of buying a home. Many people who offer owner financing are real estate investors who want a return on their money that they have invested in the home that you are buying. They have relatively no way of losing in this agreement. The home buyer has the obligation to pay, just as if you were going through a bank, and the owner collects. In most cases it is less about your credit score and more about your job stability and funds to pay. Most people who do offer owner financing are more eager to lend to hard working people because they are hard working people themselves.

Owner financing is relatively simple; you are required to do the same as if you were to get a loan from a banking institution but you are going through an individual. You will have to submit to a credit check, verify employment, sign a legal contract (making sure it is notarized and have more than one copy for your records), a down payment, which in most cases may be a lot less than a traditional bank or lending institution, and as with any other home buying contract the buyer will also have to obtain insurance on the home, which will protect the buyer and their belongings.

If you are indeed considering buying a home that is owner financed you should remember a few things. Always inspect the house from top to bottom. If at all possible hire a home inspector to do this for you. It can save a lot of time and money. It will insure that the house is in good condition and if any repairs need to be made how much it will cost in doing so. Go over the contract line by line before signing it, if anything is not totally understandable or something dis not in agreement talk to the owner, or have someone who is familiar with contracts of this nature to explain. Make sure everything has been gone over and everything is agreed upon before signing the contract. After all it is a legal contract.


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