Do Sarasota Mobile Home Buyers Need Seller Financing?

Do Sarasota Mobile Home Buyers Need Seller Financing?

How does seller financing work and is it a viable option when buying a mobile home here in Sarasota?

As we have discussed in previous blogs, obtaining outside lending for a mobile home on leased land is very difficult to do.

Many lending agencies have added additional requirements in order to lend. Some of these requirements are looking heavily at the age of the home, costly inspections that need to be completed, and further scrutiny done by the underwriters even after all this work is done.

So, what do you do if you want to purchase a mobile home on leased land but do not have enough cash to make the purchase outright?

In that case, you may want to think about the Seller financing the sale as an option.

With seller financing, you essentially have the Seller act as the bank or lending agency.

The Buyer will make an initial down payment to the Seller and then make monthly installment payments to them over a set period of time. Many Sellers are open to this as a selling option, as they understand that coming up with an all cash payment for the full price of a home can often be difficult, especially now with everything that has been going on due to COVID-19.

If a Seller will agree to holding the note on the home, then they will be the lien holder on the title. Their name will be showing on the title once you make the purchase and have the title transferred into your name. When the lien is finally paid off, then their name will be removed as the lien holder, as you will now own the home outright. This is what is referred to when people ask, “do you have clear title?”

Some Sellers will want to add interest on a monthly installment payments, just like a bank, whereas others won’t.

In our experience, we have never seen any Seller enforcing any type of a penalty for an early payoff, so, there is no need to worry about that!

If you default on the loan to the Seller, then they will have the ability to call their note due just like a bank. If the note is not paid in full, the Seller will take the property back over and resell it again.

Although cash purchases are by far the preferred method of selling a mobile home, seller financing is very popular and we expect it to grow in popularity for sure over the next year.

This is Mark Kaiser with the Mobile Home Dealer and we help mobile home buyers and sellers get to a better place in life!
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