Owner Financing: Are you making it work for you?


Owner financing has been around for quiet a while as an alternative to traditional lending. The term owner financing (also known as seller financing) means the owner of the property will hold or carrying financing for the buyer, just as a bank or traditional lending institution. A mortgage and promissory note will be created outlining the terms of the mortgage and type of loan including the agreed upon interest rate, length of the loan, etc. etc.

Although owner financing can be a great tool, it can only be done when a property is owned free and clear or there is a low remaining balance on the current mortgage of the property (typically 90% – 99% equity). Utilizing owner financing is especially beneficial when the buyer is unable to get approved by traditional lenders typically because of tight lending regulations. It can also come in handy when the buyer does not have a large downpayment to put toward the home, something traditional lenders typically require.

My company, Seasoned Funding, LLC specializes in acquiring investment properties in which the owner carries financing. Most sellers want 5% – 6% interest, with 20% – 25% down with a 3 to 5 year balloon. Terms that are considered the “norm” for the current market, yet that I feel are best suited for the seller. The short balloon payments and high interest rates can lend to limited or no cash flow,  negative equity, or a failure to pay the balloon when it is due.


Our investments are unique in the fact that our owners will carry financing with 0% interest. Yes, I typed that correctly, 0% interest! We work a little bit different, in that our structuring of the loans create win win solutions for both the buyer and seller. We can buy the property they need to sell typically for what they are asking for it or more, we get the cash flow we desire with terms that make sense for both parties.

Structuring our opportunities to have 0% interest allows us to pay down the principal at a significant rate, creating instant equity and provides us the opportunity to own the property free and clear typically with in 8 to 10 years. In addition, we do not have to pay “all cash” to get the cash flow we desire or the equity we desire. We typically put 10% – 15% down for these investments, leaving us with more capital to invest in other 0% financed deals. 

How do we do that you ask? We’re not going to reveal all of our secrets but it revolves around a series of negotiation techniques that were taught to us in a mentoring program. We are in no way scamming, or conning the seller. They are aware of the terms, but have agreed that our offer provides them a solution that works for them and gets the property sold. investment-property

If you like this investment strategy and want to take your business to a new and creative level I suggest you find out more about the Power of Zero by visiting Real Wealth.

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