When is a seller carry a good idea? There are several different opportunities and situations in the real estate world where a seller carry may be the perfect solution for both buyers and sellers. Basically in a seller carry, the seller acts as the bank; rather than the buyer getting a traditional loan from a bank, they write an offer and ask the seller to carry the loan. If you are looking to buy or sell in the Coachella Valley, residential, land, farms or investment opportunities, give Kim Kelly a call at 760-285-3578.
Vacant land can be difficult to finance. Few banks want to lend money on vacant land because there aren’t homes on the property. When I take a listing for vacant land, I always ask the sellers if they would consider a “seller carry”. Often they will as long as a buyer can come up with 30-50% down, and have good credit. It can work well for a seller if they don’t need all the money at one time, and sometimes it’s a tax benefit as well. Be sure to always consult with your tax attorney or advisor before you consider this option.
For residential properties, when a seller has paid off their home, or has alot of equity in it, sometimes they will also consider a “seller carry”. The buyer agrees to a certain amount down, with the balance either amortized, or paid off with a balloon payment at the end of the term. The buyer also pays Interest rate of course, and normally it’s just a bit higher than a traditional bank will charge. Buyers that do not have good credit, or are highly leveraged, or just won’t have the money for a certain period of time, often are good candidates for this type of situation. I’ve found that most of my seller carry’s are for either vacant land or a multi acre farm or estate. The equestrian estate in the tour below is featured at just 2.6 million.