Can I offer owner financing without going through a bank?
all i would need is a purchase agreement correct?
Umm. A bank is never involved in owner financing, otherwise it’d be called bank financing. You’d need a purchase agreement for sure, and a land contract, and a promissory note as well, assuming that you’re self closing this deal.
Please don’t take offense from this, but by the nature of your question, I’d highly recommend getting yourself plugged into one of the education channels. It’s very easy to make some expensive mistakes when you’re learning the ropes. Arm yourself with knowledge. Good Luck!
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@tpappas90 just piggybacking on what @tmiski said, unless it’s a very unique situation that involves a blend of bank and seller financing (which might happen in a huge commercial project when the appraisal doesn’t come out high enough)… for the most part, the whole purpose of seller financing is to avoid using a bank.
A lot of buyers and sellers will use it with vacant land transactions because banks simply won’t participate in the vast majority of land deals out there (unless there’s an immediate plan to develop the property).
The type of loan instrument you’ll want to use depends on the state where the property is located and how difficult they make the foreclosure process if your borrower stops paying you. More on that here: https://retipster.com/land-contract-vs-deed-of-trust/
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@retipsterseth thanks for the reply. I guess i didnt offer enough context.
i called my bank to get a business account to use to purchase my leads through my business bank account, but they asked if i was going to offer owner financing and i said yes. They said i coundnt open an account because of that. So i know i can offer owner financing without the bank but how do i buy the property through my business account if i cant get a business account because of offering financing? just look for other banks i guess?