Discover how to leverage Owner Financing to close more deals and maximize your profits. This course includes a complete system of forms, tools and information specifically designed for Buying and Selling Real Estate using the “Agreement for Deed” technique that creates a fool proof system to both buy and sell real estate without giving the buyer a deed while giving all of the tax advantages of ownership.
Agreement For Deed Concept Is Really A Major Problem Solver
This strategy allows you to sell the property with owner financing, and yet allows you to retain the title to the property until your buyer completes the payments. Conversely, you can also purchase properties where the owner is concerned about transferring title to you when they are remaining liable for an existing mortgage. This concept, also known as Contract For Deed, Land Contract, or Bond For Deed, creates the scenario that full ownership does not occur until the last payment on the loan (agreement) is made.
The Difference Between This And Typical Owner Financing
The major difference between this and typical owner financing (where a Deed and Mortgage or Trust Deed are created) is that typical owner financing sales have the Deed pass to the buyer. If the buyer ever defaults on the payments then the seller must go through the full foreclosure process to get the property back. In some states, it can take months to complete a foreclosure. However, the Agreement for Deed allows the owner/seller to let someone move in and not transfer ownership to them. In many states, this is a very common business transaction. If the buyer defaults on the payments the seller may evict them for non-payment rather than have to complete the tedious foreclosure process.
Buyer Benefits You Just Can’t Get With Any Other Structure
One of the benefits to you as a buyer on an Agreement for Deed is that you will receive tax advantages. You will receive an IRS Form 1098 from the seller showing the amount of interest you paid that year. Of course, you will also be able to write off the property taxes. If you are using the property as a rental you will be able to depreciate the improvements and deduct the costs of insurance and repairs, etc.
Seller Benefits Are Even Bigger
When you sell on Agreement for Deed your buyer will get the same tax advantages mentioned above. Since this is the case, you can usually command higher down payments from your buyers as they may see this arrangement as less risky than a lease/option scenario. When you are selling a property using the Agreement for Deed technique you are passing most of the benefits of ownership on to your buyer, but with the terms written much more in your favor to protect you. In addition to higher down payments, selling on Agreement for Deed also allows you to
“Sell” a property that needs work, to a qualified handy person without being subject to the
landlord/tenant laws which require you to be responsible for repairs. The list of advantages
goes on and on. Contact our office today for more information or get started now!
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