You may be an investor or rehabber who buys and sells properties frequently, and the quicker you are able to turn around your properties, the more profitable you are. However, when you sell through conventional means, put the property on the market and then try to find buyers who qualify through an institution, it may be 2 months to several months before you find a buyer who qualifies. Meanwhile the property may be sitting vacant and at risk of being vandalized, and you are still paying taxes and insurance on it. Is there a way of speeding up the process of advertising and selling the property?
There is a solution: Advertising your property while offering Seller Financing.
By offering Seller Financing you are in a way acting as a bank and extending financing to buyers who would not qualify through an institution due to poor credit, no credit history or past financial problems such as bankruptcy. Seller Financing expands the base of potential buyers for your property, and this alone increases your chances of finding a buyer much more quickly. It also allows you to work out the terms of the new Note with the buyer that are more agreeable for both of you.
What happens if at some point you decide you no longer want to act as a bank and receive and manage these monthly payments?
What if you do not want your money to be tied up in this way and instead want to re-invest it?
There is also a solution: Once you create the new Mortgage Note at closing, you can sell it for Cash by doing a Simultaneous Closing.
Many Note investors buy these new Notes for cash at closing or shortly after, a transaction commonly known as a Simultaneous Closing. The seller receives the down payment from the buyer plus his cash from selling the Note, and is free of the property. The Note investor now acts as the bank and receives the monthly payments from the new Note.
You will have accomplished all this in about 30 days, as compared to selling the property by conventional means in 2 to 4 months, or more. This allows you to turn your properties around much quicker so that you can consider other investments.
If you are a homeowner looking to sell your property quickly because you have been relocated through your job to another city or state, or because of other personal reasons, you may also want to consider using the above techniques. Selling quickly means no traveling back and forth while the property is for sale, no headaches about possible vandalism, no additional taxes or insurance to pay.
But this method is not for everybody. A seller willing to go through this process has to face the issues that usually realtors and lenders go through, such as setting the sales price, screening buyer’s applications and dealing with title companies. Some people are more willing than others to do this.
To make this work, the seller needs to be organized, have the house documents in good order and be willing to do some homework. That’s why there are more investors and rehabbers using this technique than there are homeowners. But the ones that venture into this new territory can be well rewarded at the end.
If you want to sell your property quickly and get cash on closing, this may be your best way to go!
Phyllis Espinoza is an expert in Simultaneous Closings, an emerging field of creative real estate financing, and the owner of the website http://www.simultaneousclosing.com . Her goal is to help as many people as possible by making this useful technique better known.