Tax deferment/reduction
Owner financing allows sellers to spread a gain out over many years or postpone all of it, giving them the ability to defer and (in some cases) reduce their tax liability.

Current income
For sellers approaching retirement, this method can provide a nice source of current income during their golden years.

Risk coverage
A well-structured agreement will provide protection from default risk. In fact, such an agreement will often make sellers hope their purchaser stops making payments, because if the purchaser defaults, foreclosure becomes possible. In such a case, the seller will be entitled to keep any down payments and monthly installments the buyer has paid up to that time, then turn around and sell the home again - for the full market price - to a new buyer!

Competitive interest
It's possible to achieve interest rates in the high single or low double digits on the net proceeds of a home sale. Few opportunities available to individuals can compare with the relative safety and interest conditions achievable via owner financing.

Broader market of buyers
Many people who are self-employed and financially viable are unable to qualify for conventional financing, since any self-employment period of less than 2 years places them in the “non-verifiable income” category. This is just one segment of the population that contains people looking ONLY for homes with a seller financing option... property investors are another. “Flexible sellers” broaden their market of potential buyers, which could help facilitate a quick, full-priced offer.

*Under no circumstances should this information be interpreted as legal or investment advice. Owner financing carries risks. Possible interest rates sellers can achieve will vary based on market conditions. Personal situations will vary and may eliminate the applicability of one or more of the benefits listed here. Always seek the advice of a qualified attorney and financial adviser before proceeding with owner financing.