Paying for the Property, Your Budget, and Seller Financing Options

As discussed previously, many online land sellers will offer some sort of financing for the purchase of property.  As with many larger priced items, many people cannot afford to put large amounts of capital up front.  Many land sellers will work with you and develop the right financing program that will fit your budget.  Furthermore, many land sellers will offer some sort of discount if the property is paid in full with cash up front.

Before you even start looking at properties, make sure to get your finances in order.  You must know how much you are willing to spend without going over budget.  Make sure you outline all your basic living expenses and allow enough for monthly property payments.

As compared to bank financed transactions, property financed through a private land seller will save money in certain fees and costs.  Many land sellers do not require credit checks or a large down payment of up to 20% down on conventional loans.  This allows individuals to invest in property who otherwise may not get approved for a bank loan.  Another advantage is that land sellers are usually flexible in the financing and will offer low monthly payments to fit your budget and lower interest rates.

At some point during the payment process, some land sellers may offer temporary buyouts for a number of reasons.  A buyout could mean significant savings for the buyer with respect to the fact that interest is spared and the deal is generally made for far less then the original loan amount.

As with any land deal, you have to be careful and understand all the financing terms.  Shy away from any land seller that charges large amounts of interest and is reluctant to disclose all financing details.

Even though financing a piece of property is not through a bank or other type of conventional lender, it is still meant to be taken with great consideration.  Make sure to make your property payment prompt and on time in order to avoid late fees or other more serious consequences.  In some contracts, if the payment becomes more then 60 days delinquent, the agreement maybe in default.  If the buyer defaults, the agreement may be null and void. The property will revert back to the seller along with any previous payments.  There are usually no refunds on defaulted contracts.

Many companies encounter instances where a buyer will make a down payment, sign the contract, and continue with a few months of payment.  After these few months, the buyer will stop making payments and become unreachable whether it is via phone, email, or fax.  As discussed earlier, communication is essential in any transaction. Any reasonable company or individual will realize that tragedies arise from time to time in one’s life.  If you are unable to make a payment at the due date, talk to the seller about your situation.  In most cases, the seller will delay the payments until you have the chance to get your situation in order. 

Also, please make sure to inform your family members of the purchase, especially if you are financing the property.  In unexpected circumstances, the family member will be able to contact the seller and inform them of what is going on.  The seller will then know to not terminate the contract for non-payment and give an extension.