Seller Financing (Owner Carry)

Reasons Would You Consider Seller financing (owner carry)

Pros for Sellers

• Can sell “as is” – potential to sell without making costly repairs that traditional lenders might require.
• A good investment – potential to earn better rates on the money you raised from selling your home than you would from investing that sum other ways.
• Lump-sum option – the promissory note can be sold to an investor, providing you with a lump-sum payment right away.
• Retain title – if the buyer defaults, you keep the down payment, any money that was paid, plus the house.
• Sell faster – potential to sell and close faster since buyers avoid the mortgage process.
• Get a higher price
• TAX BENEFITS. Many home sellers don’t worry about capital gains tax when they sell a primary residence, because they can usually exclude the proceeds from taxation. For those who can’t, an installment sale allows them to be taxed over a longer period. This is especially useful if the gain on a home sale would send you into a higher tax bracket. For example, if you sell a home for $200,000 with a $150,000 profit, the $150,000 could move you into a higher bracket. By selling it over 10 years ($20,000 a year, plus interest), your taxable gain ($15,000) might be more manageable. We recommend consulting with a qualified tax specialist to assess your personal situation. Seek CPA/Professional advice