v**n
发帖数: 130 | 1 最近搞了个owner financing, 总结了一下financing terms。 欢迎大家指点。
•Price - this is the obvious one I won't labor over it
•Interest rate - this impacts buyer’s monthly payments. of course
buyer would want lower interest rate and lower price, and seller would want
higher price and higher interest rate, but the reality is that for owner
financing deals, Neither one will/should get everything they want, so it
comes down to making a decision and negotiate between the two: As a seller,
they want higher price, lower interest rate because higher price means more
down payment and interest rate counts as personal income and are subject to
income tax, so lower interest is more preferable for seller; buyer wants
lower price and higher interest because that means pay less down payment and
interest is tax deductible.
•Down payment - the more buyer puts down, the lower interest rate and
the more equity buyer will have. seller wants more down payment, buyer
wants lower down payment for obvious reasons.
•Monthly payment: The first three things will determine buyer’s
monthly payment amount. for buyer financial well being, monthly payment
shouldn't be more than 36% of buyer’s gross monthly income.
•Loan/Balloon term - this is another key element: this determines when
buyer have to pay off the balance in full by refinancing into a
conventional mortgage. for owner financing deals, it is normally between 2-
10 years. Because no seller wants to wait 30 years to get all the money back
and no buyer wants to pay higher interest rate for 30 years. however,
within the 2 to 10 year range, seller would want to have a shorter time so
they get their money sooner, and buyer would want to have a longer term to
have more flexibility.
•Tax and insurance Escrow: seller wants escrow and buyer doesn't.
usually escrow can be waived for higher down payment amount.
•Title and Home Warranty: it is standard for seller to pay for seller
's title and to pay for home warranty. Buyer pays buyers title if they want
one.
•Option period: this is the time buyer pays seller to take the house
off the market after an agreement is reached so that seller can't accept
other offers during this time. it usually cost $10/day so that buyer buys 3-
7 day to give buyer enough time to do home inspection. during those days
buyer can back off on the offer and get the full earnest money back. be VERY
careful counting the days, they are calendar days NOT business days. once
that period is over, buyer will lose the earnest money if buyer decides to
back off.
•Earnest money: this is standard $X000 dollars payable to title
company when a contract is signed, and refunded back to buyer or counted
against down payment when the house closes.
•Inspection: this is paid by buyer, usually cost 200 -400 dollars, to
hire a professional inspector to make sure the house is in good condition. |
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