Things You'll Need:
- Newspaper
- Fliers
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Step 1
Determine the type of investment property you want to purchase. The different types may include, multiple family homes, rentals, apartment buildings, commercial property or "fixer-uppers." Do your research on each one in order to make a well-educated choice. Each investment property is different and will bring their own challenges.
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Step 2
Locate sellers willing to offer seller financing. Look through newspapers at divorce records and find their addresses through public records. Send out postcards to areas you want to purchase in. Talk with a few realtors to seek out motivated sellers. Motivated sellers are more likely to consider seller financing if they feel they cannot sell through traditional methods. This is especially true in a buyer's market, a real estate market where there are more homes on the market than there are buyers.
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Step 3
Negotiate with the seller. Price and terms will need to be negotiated. How much will you be purchasing the investment property for? What will the monthly payment be? How long will you make payments before purchasing outright? All these things need to be decided upon before closing the deal. A realtor will help you make an educated decision on purchase price, or you need to be prepared to do the research yourself. Remember, the seller is doing you a favor by holding the financing, so this may not the time to "low ball."
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Step 4
Seek out a real estate or contract law attorney. Have them draft the purchase paperwork for everyone to sign. This is a very important step that should not be skipped. It is well worth it to pay an attorney to do this to protect everyone's interest, especially when purchasing investment property with seller financing.
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Step 5
Contact a title company willing to help through this process. You will want to offer to the seller to file the paperwork with the recorder's office in the country the property resides in. This way, you offer to protect the interest of the seller who may be a little nervous by holding the financing for the property, especially if she has other financial obligations. By recording the paperwork, should you default, the seller will have some legal recourse.
