Seller Financing Tips for RV Park & Commercial Real Estate Investors
Typical seller finance terms: 5-10% down, 6-8% interest, 5-7 year balloon with 20-25 year amortization.
Balloon payments are common in seller financing. Plan to refinance or sell before the balloon comes due.
Lower down payments = higher monthly payments. Most sellers want at least 10% down to feel secure.
Interest rates on seller-financed deals are typically 1-3% above conventional rates, but with no bank fees, origination costs, or appraisal requirements.
Negotiate the amortization separately from the balloon. A 25-year amortization with a 5-year balloon keeps payments low while giving the seller a clear exit timeline.
Cash-flowing assets are ideal for seller financing because the property's income covers the payments from day one.
What Is Seller Financing?
Seller financing (also called owner financing) is when the property seller acts as the bank. Instead of getting a traditional mortgage, the buyer makes payments directly to the seller.
Why sellers agree to it: Steady monthly income, higher sale price, tax advantages from installment sales, and faster closing without bank delays.
Why buyers love it: No bank qualification, flexible terms, lower closing costs, faster closing, and the ability to acquire properties that banks won't finance.
Common in commercial real estate: RV parks, mobile home parks, self-storage facilities, car washes, and laundromats are frequently sold with seller financing because banks are cautious about these asset types.
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