Frequently Asked Questions

What is Owner to Owner Financing?

Owner to owner financing, also called seller financing, is when the property owner acts as the lender instead of a bank. This means you make payments directly to the seller according to a set agreement. It’s popular with buyers who have trouble qualifying for a traditional mortgage, such as those with low credit scores, self-employment income, or no credit history. Learn more about how owner finance works.

What is Seller Financing?

Seller finance (or owner financing) is a real estate transaction where the seller offers financing directly to the buyer. Instead of applying for a mortgage through a bank, you agree to payment terms with the seller. Benefits include faster closings, flexible down payment requirements, and fewer credit restrictions. Read our full guide to seller financing.

How Does Seller Financing Compare to a Traditional Mortgage?

With seller financing, there is no traditional bank underwriting process. This means faster approval times, less strict credit requirements, and more flexible payment terms. However, interest rates can be higher than conventional loans. Compare seller financing vs traditional mortgages.

How Do I Get Pre-Approved for a Mortgage?

Pre-approval means a lender reviews your financial information and tells you how much they’re willing to lend. This includes checking your credit score, debt-to-income ratio, and income verification. Even if you have a low credit score, some lenders and seller finance options may still work with you. Step-by-step mortgage pre-approval guide.

Can I Get a Loan with No Credit Check?

Yes, but these are usually alternative financing options like seller financing, private lenders, or certain specialized mortgage programs. While “no credit check” loans exist, they often come with higher interest rates or require a larger down payment. See our list of no credit check loan options.

What is the Average Down Payment for a House?

The average down payment in the U.S. is around 6%–20% of the purchase price, depending on the loan program. In seller financing deals, the down payment is negotiable and may be lower or higher depending on the agreement. Calculate your ideal down payment.

What is Debt-to-Income Ratio and Why Does it Matter?

Your debt-to-income (DTI) ratio is the percentage of your monthly income that goes toward debt payments. Lenders use this number to determine how much mortgage you can afford. Seller financing can be more flexible with DTI requirements than banks. Use our debt-to-income mortgage calculator.

Are Mortgage Rates Going Down?

Mortgage rates change frequently based on the economy, inflation, and Federal Reserve policy. While rates may drop in the future, locking in a seller financing deal can give you predictable payments regardless of market fluctuations. View current mortgage rate trends.