Should You Offer Owner Finacing When Selling Your Home?

I'm sure I've talked to hundreds of homeowners over the years who think they want to sell house themselves

. It's not that I automatically think it's a bad idea, but it needs to be considered carefully. Some people decide to sell by owner and it works out really well for them. What I'm suggesting in this article is that circumstances have changed a lot over the years I've been buying and selling houses as a business and the most significant difference I see today is the tight mortgage loan market. Nobody who is selling a house today can afford to remain ignorant about the very real effect that tight mortgage money may have on closing a sale.

Now, everything changes when a real estate agent gets involved in a sale, either as a buyers' agent or as a regular agent who shows the buyers the house after arranging with the seller to be paid a commission. If there is an agent working with the buyers you can be more confident that the buyers will have competent help navigating the complexities of mortgage financing. But if you sell a home by owner without an agent involved then nobody is there to provide assistance to the buyers when the time comes to get financing. The truth is, your buyers are on their own because nothing you can do helps them along once you've all signed the purchase agreement.

There is an alternative to this dilemma that solves the problem of buyer financing when you sell by owner. The buyers can contact a buyer's agent to help them close the transaction. Getting through the financing process is the buyers' own responsibility so they should pay an agent to help them. Buyers' agents have become quite common in metropolitan areas so it shouldn't be difficult for them to find one. Most agents know that in order to grow their own business they may have to step into a transaction like this, so keep checking around and you'll find an agent to help your buyer so you can get your sale closed.

When you sell by owner you have to make sure that your title search is being conducted while your buyers are getting financing approval. The title search is your responsibility as the seller in order to provide the buyer with clear title, meaning verifying that there are no liens against the property. While the buyers' lender will be providing all the mortgage documents, your attorney or title company will produce the other closing documents such as a deed of trust and many others. You initiate the title work by delivering your signed sales agreement to an attorney or a title company for them to take care of the legal work for you. Of course when you list with a real estate agent yourself, he or she will take care of that part of the process for you. Until you are pretty familiar with the process it's good to have some professionals on your team during the closing process helping you follow along. Many times I have seen mistakes in closing statements and that's why it's important to have someone else looking over the documents on your behalf prior to closing day.

by: Leo Kingston

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