• Pace Morby

Using Creative Financing to Help Sellers: 4 Reasons Homeowners Subto or Seller Finance

You guys know how much I love creative financing.


I can’t say enough about it.


I’m known as the ‘creative finance guy’, cause I love it so much.


So, why would a seller not go through a realtor or list their house on the market list?


Not only am I going to answer this question, but I’m going to give you 4 big reasons why sellers go through with creative financing, whether it be subject to, seller finance or even both.


4 Reasons Sellers Sell Using Creative Finance


When people sell their homes, the first thing they think of is going to a real estate agent.


Or maybe they start listing on seller lists.


The problem with doing that is, as a seller, you actually lose time and money.


Think about it.


You have to spend the time to find an agent to sell your house or time to find the right list – or all the lists – to put your home up.


And then there’s the time it takes to actually sell your house.


I’m sure you’ve heard my F-150 story or how I got my current house, but in a quick summary, both of these were done through creative finance.


I wanted a certain amount for my F-150 and I wasn’t getting it; it was almost 3 months before I actually sold it.


Dave, the original owner of my house, had waited 6 months before I learned about the deal and ended up buying this beautiful home subject to.


That leads me to the number one reason why sellers sell with creative finance.


#1 Reason: Money


Hands down, using creative finance means that sellers actually make more money than if they were to just use a realtor or put it up on the market.


Here’s the thing – when you sell with a realtor or use the market, you have to pay a percentage or a commission.


Basically, that’s less money in a seller’s pocket.


A lot of people think that the equity is what is what they owe and what pricing they see on Zillow.


It’s not.


That’s actually called the spread.


Equity is what you have in your pocket after you sell your property.


And a lot of times, after you’ve paid commissions and fees, a seller actually has less than what they think should have.


Creative financing, however, allows a seller to give us the terms we need so they can get the price they want.


This is true for seller finance or subject to – a seller gets the money they need, when they need it.


Which brings me to reason number two.


#2 Reason: Pain


Pain points are the challenges someone has that they need to have solved.


For us, a seller’s pain is the reason why they’re considering creative finance in the first place.


My team and I have worked with a lot of sellers and every one of them has a different pain point that’s causing them to sell their home.


One deal I had was a woman who had just bought a house with her husband and a month later, the husband ended up dying.


Not even considering that she’s grieving the loss of her husband, her husband was the primary source of income.


She has a large property she can’t pay on, on top of everything that has to be done after the death of a loved one.


Dave, the guy I bought my house from, was trying to move into a new home, but couldn’t until he sold his old one.


Remember, his home was on the market for 6 months and the realtor couldn’t sell it.

One of my sellers, Karen, was nice enough to do a video and talk about how using subject to help her sell when she had zero equity:



With creative financing, not only did both of these sellers get the money they needed, they were able to solve their pain in a painless way.


And that brings me to reason three.


#3 Reason: Lump Sum Payment


When you structure a creative financing deal, in most cases, the seller is going to get the agreed upon payment in one lump sum.


Even if you are seller financing, you’re still paying them a monthly fee on top of what you initially paid for the house.


Remember reason 2 – their pain point?


Some pain points are solved by getting the property off the seller’s hands, so they can reap the benefits of getting their money.


And in many cases, that money is going towards some other purpose.


For my seller who had just lost her husband, that money could’ve gone to moving (she had to move in with her son), funeral costs, burial costs, who knows?


What matters was that she was able to get that money, in her hand, so she could use it as soon as possible.


One deal I had, a seller was in the midst of moving cross country, from North Carolina to Arizona.


The down payment I paid her helped her with moving, rent, and other travel costs.


If a seller needs to sell fast, they don’t have the luxury of waiting for a realtor or a listing to be seen.


#4 Reason: Taxes


Lastly, sellers can avoid the taxes that come with selling their homes in a traditional real estate process.


With seller finance, for instance, a seller can avoid paying the taxes for the sale in the first year!


Creative financing can help sellers make more money, solve pain points, gets them the money they need, and help them avoid a high tax bill.


So many people are helped by using creative finance and for my team and I, that’s the whole point of why we do this.


If you want to learn more or you want to learn how to further help sellers, what’re you waiting for? C’mon and join our community!