A detailed explaination of Temporary Seller Financing, and how it benefits both sellers and buyers.

What is Temporary Seller Financing?

Seller financing (also known as an owner carry-back), is when the seller allows the buyer to purchase property with a promise to pay over time. Instead of receiving a lump sum of cash at the time of sale, the seller receives principal and interest payments directly from the buyer.

There are many people who can afford the monthly payments, but who cannot qualify for a conventional mortgage. By offering seller financing, home sellers can expand their pool of potential home buyers indefinitely.

Most home sellers cannot afford to accept payments overtime. They need the proceeds of the sale to pay off their mortgage and make a down payment on their new house. With Temporary Seller Financing, home sellers can offer seller financing and still get paid in full-- in cash right at the closing table.

As outlined in the new book by Erica Alston, High Speed Home Sale, the process is simple. The seller originates the mortgage document in much the same way as a traditional lender would. But, the seller does not have to hold the note and accept payments over time. In a simultaneous transaction, the seller will sell that newly created mortgage note right at the closing table.

Temporary Seller Financing benefits both the seller and the buyer. By having an unlimited pool of potential buyers to draw from, sellers are able to sell faster, easier, and for top dollar. Buyers benefit from using temporary seller financing because it enables them to buy the home that they want when they cannot qualify for a conventional mortgage.