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Seller Financing

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  • 04-02-2013 12:46am
    #1
    Chiorino
    Registered Users Posts: 621 ✭✭✭


    I believe this is relatively common in the states but have never heard of it happening here. Is there are reason for this? Given the banks current attitudes to lending it would probably appeal to a lot of people.


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    #2
    The_Conductor
    Moderators, Society & Culture Moderators Posts: 32,285 Mod ✭✭✭✭The_Conductor


    Chiorino wrote: »
    I believe this is relatively common in the states but have never heard of it happening here. Is there are reason for this? Given the banks current attitudes to lending it would probably appeal to a lot of people.

    It was common here for years and years- its known as bridging finance. All institutions offered it, at varying rates, but normally less than the overdraft rate. When property was reliably selling in reasonable timeframes it meant people could buy somewhere else, financing it with a bridging loan, while they sold their own property. Bank of Ireland are still offering bridging finance under strict criteria, and by god you pay for it. I'm not aware of other lenders still having products of this type on offer.


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    #3
    Chiorino
    Registered Users Posts: 621 ✭✭✭Chiorino


    smccarrick wrote: »

    It was common here for years and years- its known as bridging finance. All institutions offered it, at varying rates, but normally less than the overdraft rate. When property was reliably selling in reasonable timeframes it meant people could buy somewhere else, financing it with a bridging loan, while they sold their own property. Bank of Ireland are still offering bridging finance under strict criteria, and by god you pay for it. I'm not aware of other lenders still having products of this type on offer.
    Think we have wires crossed here. Seller financing as in when the person selling the property effectively provides the mortgage by taking a deposit and subsequent repayments directly from the buyer.


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    #4
    drunkmonkey
    Registered Users Posts: 28,192 ✭✭✭✭drunkmonkey


    The banks are lending just not foolishly, if your asking are there any foolish sellers lending the money to buy their own properties, no. Why would a seller finance a property a bank wouldn't.


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    #5
    zac8
    Registered Users Posts: 530 ✭✭✭zac8


    drunkmonkey wrote: »
    Why would a seller finance a property a bank wouldn't.

    Well in the US if a buyer doesn't keep up repayments then the seller just repossesses. As it's not so easy to repossess here I can see why seller financing is not common.


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    #6
    Chiorino
    Registered Users Posts: 621 ✭✭✭Chiorino


    zac8 wrote: »

    Well in the US if a buyer doesn't keep up repayments then the seller just repossesses. As it's not so easy to repossess here I can see why seller financing is not common.
    Ok, think you might have just answered my question. How do repossessions work in the US as opposed to here?


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    #7
    Scortho
    Closed Accounts Posts: 3,876 ✭✭✭Scortho


    zac8 wrote: »

    Well in the US if a buyer doesn't keep up repayments then the seller just repossesses. As it's not so easy to repossess here I can see why seller financing is not common.
    Ah Jeysus that's far too much hassle! If I sell my house I want the full price of it not .x of the selling price. I could also see my bank throwing up problems when it comes to the new mortgage.
    What kind of borrower would they be, if they can't get a mortgage from a bank? And lastly would there not be tax implications as well?


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