Do I need to check credit when owner financing
In short, absolutely check credit when owner financing. Unfortunately, I don’t get this question enough and we run across some owner financed borrowers with very poor credit. This could easily make the note unsellable or at the least make the value much less. Even if your buyer doesn’t have great credit, at least you’ll know what you will be up against when considering selling to mortgage buyers. It also could help you in interest rate negotiations. On top of poor credit (known or unknown), many property sellers give their buyer a good interest rate. Even 6% is not much of an incentive for your buyer to improve their credit unless you have a balloon. So check credit of your buyers when owner financing or have them provide you with a recent (less than 30 days old) credit report. You may still sell them your property but it may significantly effect the terms of your note. Good luck. Call us if we can help at 1-877-655-5625. Ask for Ron.