If the seller will allow payments you
will probably get the best financing. Seller financing
on raw land may be available with as little as 10 -
20% down. In the case of a house or other improved
property, the standard down payment is 20% or more.
Most sellers
are charging about 10% interest -
While allowing buyers
5 - 10 years to pay. If you are buying property
this way, you won't be able to obtain a title
to the property until you have completely finished
paying for it. For these situations you can secure
your position in the' chain of title by registering
an "Agreement
for Sale".
Negotiate
the right to pay off the property early without
penalty -
Some sellers would like all
the interest due them from the loan and would
prefer to not have the loan paid off. This
can be a costly error for a buyer.
If you do not have the ability to pay off early,
you may find yourself unable to sell your property
to a good buyer who is willing to pay in cash.
Avoid if you can, the position of not having
the ability to sell when you want to!
Bank
loans generally have higher interest rates
than seller financing -
If you
are getting bank financing for a purchase, include
a provision for loan approval in your offer to
buy. If the
loan is denied, the buyer would have
the option to cancel the agreement to purchase. In
the event of cancellation. the Buyer's earnest money
is refundable. The time to obtain the loan should
be realistic depending on what the processing
time is at the bank and the interest rate you
select at the time you are applying.
