What is Owner Financing?

Example: Owner Financing for a Traditional Buyer 📅

- 🏠 **Purchase Price:** $149,000 + $14,900 Down Payment

- 💳 **Loan Terms:** 10 years at 10% interest

- 💰 **Monthly Payment:** ~$1,964.31

- 💵 **Total Paid Over 10 Years:** ~$235,717

Perfect for buyers who want to skip the bank and work directly with the seller!

Example: Owner Financing for a Fix-and-Flipper 🔨

- 🏠 **Purchase Price:** $149,000 + $14,900 Down

- 🔧 **Repair Budget:** $50,000

- 💎 **After Repair Value (ARV):** $250,000

- 💳 **Loan Terms:** 10 years at 10% interest (but you plan to sell within 12 months).

💸 **Costs to Sell:**

- Realtor Commission (6%): $15,000 (Varies per deal)

- Closing Costs: $5,000

📊 **Profit Calculation:**

- Total Investment: $149,000 + $50,000 + $15,000 + $5,000 = **$219,000**

- After Sale: $250,000 - $219,000 = **$31,000 Profit**

Great for investors who want a flexible way to acquire property, fix it up, and sell for a profit!

What About Hard Money Loans? 💵

**Hard money loans** are short-term loans from private lenders, great for investors who need fast funding to fix and flip properties.

💰 **Example for the Same Property:**

- **Loan Amount:** Up to 70% ARV = $175,000 (covers purchase + $26,000 in repairs).

- **Interest Rate:** 12% (1% per month).

- **Points:** 2% upfront = $3,500.

💳 **Costs:**

- Monthly Interest: $1,750 × 12 months = $21,000.

- Out-of-Pocket Repairs: $24,000.

- Total Investment: $223,500.

📈 **Profit:** After selling at $250,000, profit = $26,500.

Who Should Use Owner Financing or Hard Money?

✔️ Buyers with poor credit.

✔️ Investors looking for flexibility.

✔️ Flippers who need fast, easy funding.

Which option works for you? Let’s talk! 💬

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