There are numerous and profitable paths a real estate investor can take. Explore, in detail, a few of those paths below and learn how seasoned investors create wealth in their specialties.

Buying Creatively Using Seller Financing

Buying properties creatively using seller financing is probably one of the original investment strategies and it's still used today even though you don't hear that much about it in the media. It's not as sexy as rehabbing, but it's definitely worth looking into and even adding it to your investment toolbox.

We'll dive in and discuss what seller financing is and why you would want to consider learning about it. Also, we'll see how this strategy can be used in a variety of ways, not just for you also advantageous to the seller!

What is Seller Financing and Why Would You Want to Structure Your Deals for This?

Seller financing happens when the seller finances part or all the loan for you in order for you to buy their house and you make the mortgage payments directly to the seller instead of the bank. This is extremely helpful if you can't qualify for a bank loan or you just rather not deal with banks in general.

You can also offer seller financing (or terms) to your buyer with either a larger downpayment and/or higher monthly payments than you're paying the seller. This difference would be your revenue. Do this a few times and you'll have the cash flow (passive income) to live on for as long as you have the properties!

How Does This Benefit the Seller?

As a seller, it's only natural to want as much cash as you can get for your home, but that's not always possible. So the seller has to decide if taking the cash is better, even though the offer is much less than they had hoped for. Most sellers will wait it out until the perfect buyer comes along to pay their higher-than-market price.

Unfortunately, as they wait for the perfect buyer, the reason for them selling the house initially is still an issue. May they need to relocate or maybe they're losing their house to foreclosure, but the longer they wait, the stronger the need to sell. It's not long before they start to become more flexible and that's where seller financing comes into play.

Another reason a seller would benefit from seller financing is to avoid having to pay expensive capital gains had they sold for cash. Receiving a downpayment and collecting money every month is a stable income for them while the equity in their home grows.

Also, if the seller wants to move into another home and is getting bank financing for that home, the house they seller-financed does not go towards their debt-to-income ratio because it's seen as an investment. This allows them to get a loan for their new home.

Giving Your Seller Options

One method we have success with (and sets us apart from most investors making low ball offers) is giving the seller an offer with multiple options. We send them one letter of intent to purchase their house and on that letter is a cash offer and maybe two seller financing options.

This technique is too extensive to get into here, but we've found Joe McCall's way of explaining the concept quite thorough and pretty straightforward.

Some Seller Financing Do's and Don'ts

Cras faucibus purus tincidunt tincidunt mollis. Fusce placerat augue et porttitor sodales. Ut tincidunt leo in arcu suscipit ultrices. Morbi volutpat imperdiet molestie. Pellentesque magna tellus, tempor in tincidunt sit amet, placerat a mi. In dolor quam, hendrerit a orci eget, accumsan bibendum sapien. Curabitur hendrerit mi massa.

Best Tools for Creative Financing

ProfitDrive App

Get control of your time by leveraging our tools to do the dirty work for you. Be the first point of contact with motivated sellers, giving you the upper hand and getting your hands on more deals before your competition even gets the mailer out! Grab the D4D app and start driving today!

App for iPhones or App for Androids

NETR Online

The Public Records Online Directory is a Portal to those Tax Assessors', Treasurers’ and Recorders' offices that have developed websites for the retrieval of available public records over the Internet.

Examples of records that can be accessed include deeds, mortgages, assessment data, tax details, and parcel maps.

Tracking Spreadsheet (Free version)

Tracking Spreadsheet (Paid Version)

BeenVerified Skip Tracing

People Search is a powerful tool that may let you see a more complete picture of a person. If you have a person's name, you may be able to uncover useful information to help you make important decisions about who you interact with online and in real life.

BeenVerified’s People Search tool combs through billions of data points across dozens of public databases and prepares a detailed report that may include current and past addresses, contact information, employment history, social media accounts and potentially more.