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You are here: Home / Buyers / Key Term Tuesday: Seller Carryback Financing

Key Term Tuesday: Seller Carryback Financing

June 19, 2018 By Rebecca Jacks

We understand how frustrating it can be to search for a home in Austin. Half the battle is learning the key terms and what they mean in regards to Texas real estate. So each week we bring you Key Term Tuesday – our way of helping you decode the industry jargon that keeps you from owning your home search.

Seller Financing

What is Seller Carryback Financing?

Seller Carryback Financing (aka Seller Financing) describes a situation where the seller both sells and finances the home’s purchase. Instead of accepting cash for all or part of the purchase price, the seller accepts a promissory note. For example, a home is sold for $100,000. The seller accepts a $10,000 cash down payment, receives $50,0000 from the cash proceeds of the buyer’s bank loan and carries back a $40,000 promissory note for the balance.

Seller Carrybacks are used in situations where bank financing is very expensive (ex. high interest rates) or the property does not meet the lender’s underwriting standards. In times when interest rates are affordable, carrybacks are not as common as sellers generally prefer cash proceeds rather than a promise to pay later.

Seller Carrybacks, when possible to employ, can be a creative way to get your home sold.

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Our team has a combined 55+ years of experience helping home buyers understand the residential real estate market. Check out our approach to Buying a Home in Austin to learn more about our team and how we work. Then, call us at (512) 827-8323 or email us at info@11OaksRealty.com to schedule a no obligation consultation.

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Filed Under: Buyers, Sellers Tagged With: First Time Home Buyers, Real Estate Key Terms

About Rebecca Jacks

Rebecca has founded her success in real estate on a commitment to personalized service. Clients appreciate her dedication to not only the success of their transaction, but their very peace of mind. She is particularly adept at creating bridges to make home buying and relocation as seamless as possible.

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