You don’t have to wait years or decades to receive your money (or what we call immediate cash). With seller financing, you can choose to sell all or just part of your future payments for cash today.
You have two options: a full purchase or a partial purchase:
- A full purchase involves selling all the remaining payments on your land contract, mortgage note, or trust deed and with that get full immediate cash for your note’s worth
- A partial purchase involves selling only a portion of the remaining payments. In that option you also going to get immediate cash but with smaller amount while retaining some of the payments
For example, if you have 120 months of payments remaining on a $90,000 note with 9.0% interest and monthly payments of $1,140.08, you can sell all 120 payments to an investor for a full purchase. If you only sell the next 48 monthly payments to an investor, it would be a partial purchase.
There’s also a split partial option, where the monthly payments are divided between the investor and the seller. Whichever option you choose, the terms of the transaction will be outlined in the Purchase Agreement to protect everyone’s rights.
So which one is the best – partial purchase or full purchase?
It depends on your cash needs and the value of the payments being sold. A partial purchase might minimize the discount, but there’s always a risk that the buyer won’t keep payments current in the future. A full purchase gives you peace of mind, knowing you can be through with the property once and for all.
To discuss your options for your owner financed mortgage note, please contact us.
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