seller financing

Definition

When the property seller acts as the bank because either the buyer can't get a traditional loan or the seller wants to collect interest payments. It's basically a handshake agreement with paperwork, beloved by people who can't qualify for mortgages and sellers who enjoy playing banker.

Example Usage

We offered seller financing with a balloon payment in five years, betting they'll either refinance or we'll get the property back.

Source: Alternative real estate financing terminology

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takeoff

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balloon payment

A large, final payment due at the end of a loan term that covers the remaining principal balance. Named for its tendency to inflate your anxiety levels right before it's due.

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