Annapolis, Maryland – As we are all too aware, obtaining a mortgage today is much harder than it was just a few years ago. Much of that is due to the obvious fall out from the real estate recession, which started in 2010. Many areas were faced with a true crisis of confidence in the marketplace, as banks rushed to give out money, often to people who probably should not have been granted mortgages to begin with. Unfortunately, the knee-jerk reaction to that was to tighten lending guidelines across the board, even to well qualified Buyers. The impact that has had on sellers here in the Annapolis area cannot be understated.
One old concept, which is seeing a bit of a revival these days, is Owner Financing. This concept can give home sellers an edge over competition as it fully eliminates a large obstacle many buyers face today, and in turn will help augment your number of buyers. Another benefit to consider is the steady income you will receive from the mortgage payments. Right now with all of the market volatility that we are experiencing, and deposit interest rates near 0%, this could be your one steady interest earner – in some cases up to 7% or more!
This could be a great monthly return if you don’t need the proceeds from the sale of your home immediately. You might also consider partial seller financing. Most buyers will have a cap on their loan allowance, and as the seller you can consider financing the rest at a higher interest rate than normal.
Keep in mind that as the seller you would not have to hold on to this mortgage forever, as it can be sold on a secondary market. With that all said, however, you also need to seriously consider the issues of a potential Buyer default, which could leave you facing the prospect of having to foreclose on the mortgage and reclaim the home through that process. Of course, you never know what the Annapolis real estate market will be like at that time, but fortunately this area has remained more stable than other regions of the country.
The other day I ran across this great article from Inc. Magazine that you may want to check out: http://www.inc.com/mike-handelsman/is-seller-financing-for-you.html. Before making a final decision on whether or not this is a realistic option for you, we should probably sit down and go over the specific situation, and see if it makes sense for you and your family.
With a broad background and strong record of success, Carlyn brings extraordinary skills and talents to her real estate clients in Annapolis and Anne Arundel County. Having owned rental properties, Carlyn has the skills and experience to help her clients build and manage their own profitable and secure rental portfolios, and cash them out when the time is right.
Carlyn comes from a tradition of service, is ready to serve, and she especially enjoys working with current and prior service members. Having spent over ten years building software companies, Carlyn enjoys working with successful business people, entrepreneurs, and the self-employed. She uses her high-tech expertise and financial knowledge to sell their houses effectively and for a higher price, and to find them the homes they want, while saving them time and money.
She has been awarded the prestigious Certified Residential Specialist (CRS) Designation by the Council of Residential Specialists, the largest not-for-profit affiliate of the National Association of Realtors®. Carlyn has earned lifetime membership in the Distinguished Sales Achievement Club, membership in The Masters Club, and designation as a Certified Luxury Home Marketing Specialist and Million Dollar Guild Member. For inquiries you can contact her direct at (443)569-3977 or by email at Carlyn@LoweryHomeTeam.com