Looking to sell your property? You might be considering owner financing as an option. But here’s a common question we hear from homeowners in Fl: “Can I offer owner financing if I still have a mortgage on the property?” This is an important consideration that many sellers face. In this comprehensive guide, we’ll address this question directly and provide you with practical strategies to navigate your options. Keep reading to discover how you might be able to move forward with your home sale, even with an existing mortgage…
You have options
When considering selling your home, you have several paths to explore. You can work with a real estate agent, manage the sale yourself, or sell directly to a buyer. However, many savvy homeowners are discovering the advantages of “owner financing” or “seller financing” – a straightforward approach that allows you to sell your property while receiving consistent payments that gradually pay off the home:
- The buyer provides an initial down payment
- The buyer makes consistent monthly payments directly to you
- Once the agreed-upon price is fully paid, the property title transfers to the buyer
Sellers appreciate this approach because it expands their market and creates a reliable income stream. It opens doors to qualified buyers who might struggle with conventional bank financing. Buyers value this option because it provides more purchasing opportunities without the potential negative impact on their credit scores that traditional financing might cause.
If you own your house outright, you can do a seller financing agreement. But what happens if you have a mortgage? Maybe you’re wondering, “Can I do owner financing in Fl if I have a mortgage on the property?”
The short answer is: it’s complicated.
Seller financing with a mortgage
In some states, you can create something called a “wraparound mortgage” in which you extend a mortgage to a buyer (usually at a higher rate of interest) while still paying your own mortgage to the bank. However, this is not legal in all states and all situations, and there are additional clauses that you should be aware of.
Can I Do Owner Financing if I Have a Mortgage on the Property? – You have choices
If you’re facing challenges selling with seller financing due to an existing mortgage, don’t worry – you still have several viable alternatives…
One effective option to consider is a rent-to-own arrangement, which shares certain similarities with seller financing (like regular payments and eventual ownership) but with key differences. Rent-to-own typically doesn’t require an upfront down payment, but the buyer will need to qualify for traditional bank financing at the conclusion of the predetermined rental period.
If you’re contemplating owner financing but still have a mortgage on your property, here’s a better solution: Contact us today to discuss your specific situation. As experienced real estate specialists, we understand numerous creative options that might not be on your radar. We can guide you through these alternatives and either assist you directly or connect you with the right resources to help resolve your situation.
Get in touch with us today by clicking here to fill out the form or by calling us at 239-744-2602.