Creative Financing

Offering creative options can save a sale!

In certain cases, you will need to go outside the box and come up with creative solutions to a roadblock standing between you and a buyer. Those solutions may be the pivotal point between getting your home sold to an interested buyer, and watching a deal fall through.

I am not here to tell you, “Oh, it can’t work, it won’t work. Everybody’s a failure. Woe is me. Nothing works. There’s no good ideas, be a Negative Nelly, have a negative outlook in life.” That’s not me. If you like a Negative Nelly outlook, go somewhere else.

You do have to be realistic. The mainstream way will not always work. Be prepared with options, and you won’t lose a sale. Here is one option you should consider. It is not traditional, not ordinary, and not endorsed by most financial people.

Your friends will probably not agree with it, either. Some of your friends would even tell you it is a stupid suggestion. Some might say you’d be dumb to even consider this option, and tell you it’s a horrible idea. And I understand all that. Just don’t give up at the first hurdle!

Under the right circumstances,

this seemingly crazy option can be beneficial to you.

The option is offering owner financing or selling your house with a lease option. There! I told you. Pretty crazy, huh? “What? I don’t want to do owner financing. That’s a horrible idea.”

Well, I did tell you it was not traditional. I did tell you it is not endorsed by the mainstream. However, under the right conditions, owner financing can be a good idea.

Consider an example of two people

who owned rental houses.

The first person got a start in the 1970s with rental houses. Today, he’s a multi-millionaire. He began with one rental property and grew. Today his business manages thousands of rental properties.

Nathan Collier is a real estate investor in Gainesville, Florida. If you met Mr. Collier and asked, “Nathan, do you think rental properties are a good investment?” he’d answer, “Yes, rental properties are an incredible investment.”

“I love rental properties. They have made me rich beyond my wildest dreams. I started with one in 1970s. Today, I own thousands.”

 “In fact, owning and managing rental properties helped me become one of the richest men in Gainesville. I’m worth millions.” (not to imply he is cocky; I just don’t know his exact worth)

If you ask Nathan Collier whether he likes rental properties, he’s definitely going to tell you they are a great investment.

Mr. Collier has had success with rental property.

Bob has not done so well.

Bob owned a house. He moved away to live closer to the beach. He didn’t sell the original house when he left. Figured he’d try his hand at renting the house, and see what happened.

He bought it for $350,000. The house was decent, but renting has taken a toll. It’s probably worth $300,000 today. Rent checks don’t cover much more than the basics. He’s upside down on the loan.

Bob owes more on the house than it is worth. He has good credit. He doesn’t want to do a short sale. He has it rented out, but repairs are costly. At times, he has difficulty collecting the monthly rent.

If you chatted with Bob and said, “Hey Bob, do YOU think rental properties are a good investment? Could you really become a multi-millionaire by investing in rental properties?”

He’d probably shrug and say, “You know what? I think maybe some people can make money in rental properties, but I doubt I could ever make much money at all, let alone millions of dollars, doing rental properties!”

There are many choices in life.

The important thing is finding one that works for you!

The moral of the story is I am here to give you options and to plant seeds of ideas in your mind. I want to be clear what works very well for one person, may work terribly for another.

There are many ways to sell your house without dropping the price. Owner financing or a lease option is just one of those ways.

Is owner financing low risk? Nope. Is a lease option low risk? Not really. Both choices carry risk. However, for the right person who is willing to take the risk, it is a way to sell your house when other ways have failed. If you understand the downsides and have a plan in place to reduce the negative aspects, it can be a good option. It may be a good educated risk for the right person.

Understanding the options available will help you choose wisely if the need arises.


Let’s assume you’re selling a $600,000 house with owner financing. Let’s say you have someone with the worst credit in the world.  However, they pay you cash. Because of the risk involved, they are willing to give you a down payment of $300,000 for the house.

The buyer has a solid job or business or good earning potential. The economy is strong, and they work in a steady industry. One that is going to be around for a long time. Unfortunately, they have made some unwise choices in the past, and have horrible credit.

If they are ready to buy your home, it may be worth doing owner financing. You would not sell your $600,000 house for $600,000 in this case. You can work with them, but you are going to ask for a premium price.

To a buyer who is not getting conventional financing, ask for 10% more than the house is worth. You would sell for $660,000. They would put down a payment of $300,000.

In that specific situation, it would make sense if you have the right safeguards in place. Every situation is different. Evaluate the exact case you are in, and make a slow, careful decision. That is the key. If you are NOT comfortable, do NOT go through with the deal.

I’m not saying you should do owner financing. I’m not saying I endorse it or not. I’m just saying it is an option you could use to sell your house without dropping the price.

If you are thinking about owner financing, I can give you more information on it. The main purpose of this entire book is to share helpful tips and ideas.

One of the responsibilities I have as a real estate agent is to help every client complete their transaction, and see them through to a successful end! Many times that involves coming up with creative options to share along the way. I also work with good lenders and finance companies. Don’t ever hesitate to ask for suggestions or advice!

I’ll be glad to discuss it with you and cover the pros and cons of your specific situation. Selling a home may well be the biggest transaction of your life, so take time to ask for help if you need it.

Don’t ever rush into a situation you feel you may regret later. Chances are you probably will! Just like this book, I’m here to help. Just ask.


Relates To  -  home seller tips