Owner funding is definitely a appealing option to old-fashioned lenders, and perhaps can be much easier to get. Needless to say, in this situation funding is totally kept into the discernment associated with the land owner, which means you should be willing to negotiate a great deal. Nevertheless, if you’ve been rejected by your bank or credit union, owner funding is the next option that is best.
In terms of land that is buying there are 2 fundamental kinds of owner funding – ‘contract for deed’ and ‘mortgage/trust deed’. Each has its advantages that are own drawbacks both for customer and seller.
- Contract for Deed – often known as a ‘land installment contract’, this enables the customer to pay for the land owner in installments more than a predetermined time frame.