What are the benefits of selling your land with seller financing? Below are just a few of the benefits to the Seller when they sell property with owner financing.
1. Tax benefits: In many cases, sellers may benefit from favorable tax treatment when selling property with seller financing. By spreading out the capital gains from the sale out over multiple years with smaller dollar amounts, sellers may be able to lower their overall tax liability. However, as always, it is essential to consult with a tax advisor to understand the specific tax implications of a seller-financed transaction.
2. Faster closing process: Seller-financed transactions often close faster compared to conventional mortgage loans, since they bypass the lengthy underwriting and approval process required by traditional lenders and banks. This faster closing process can be especially beneficial in a slow market, or with a property that may have unusual physical characteristics like a steep slope or flood zone issues.
3. Potential for higher selling price: By providing financing, sellers are many times able to command a higher sale price for their property, since buyers may be willing to pay a premium for the convenience and flexibility of seller financing. This is particularly true with land sales, since banks rarely make loans for the purchase of raw land.
4. Steady Stream of Income: Buyers pay sellers monthly payments over a period of time. This means that sellers receive a steady stream of income that can yield a higher return than conventional alternatives like CDs, stocks, or retirement accounts.
5. Fewer Restrictions: Since the seller is the lender, there aren’t as many restrictions as there are with a traditional mortgage. There are also fewer hoops to jump through for buyers. And the buyer and seller are free to come up with any sort of terms that suit both parties and help the sale get to the finish line, and assure that it’s a win, win for all parties going forward.
6. Flexiblity: Seller financing allows land owners to negotiate flexible terms that suit their financial needs and goals. This flexibility extends to factors such as the down payment amount, interest rate, repayment schedule, and even the possibility of balloon payments. Such customizable terms can make the property more attractive to potential buyers at a higher price and to investors whom may be seeking a more tailored financing arrangement.
7: Professional Loan Servicing: We set up all of our mortgages with a professional loan servicer, both when buying and when selling. They take care of everything: collections, disbursements, notices, payment tracking, tax documents, and more. This allows us to focus on what we do best: buy and sell land. And you could realize this benefit as well when you sell to us with seller financing… A truly passive monthly income.
These are just a few of the benefits to selling your land with seller financing. If you think this is something that you could benefit from, call or text the number below. We’ve bought many properties with seller financing, and we’d like to discuss buying yours.
David Scruggs
(405) 352-2000
www.spiritlandco.com