Everything You Need to Know About Seller Financing

Financing real estate transactions follow a standard practice that involves factors such as meeting income requirements, employment verification, and assessing a prospective buyer’s credit score to determine eligibility for a mortgage from a bank or other financial lender. 

But what happens when a buyer isn’t able to satisfy the requirements needed to secure a traditional mortgage loan, yet still wishes to move forward with a real estate transaction? In these instances, seller financing is a great opportunity for a buyer to continue on a path towards homeownership while avoiding the restrictions of bank lending, and it is a service that SRC Land takes pride in offering to aspiring landowners.

Understanding Seller Financing

To put in the simplest terms, seller financing is the opportunity for someone selling a home or property to finance the purchase for a buyer rather than requiring a prospective buyer to seek a bank’s assistance in securing a mortgage loan. 

Seller financing grants the buyer a chance to purchase property quickly and at a lesser rate than that of a traditional and/or conventional transaction. 

Important Aspects of Seller Financed Real Estate

A seller-financed property will likely run for a shorter period than what would be expected as part of a conventional mortgage. It’s important for a buyer to inform themselves on the terms of the financing agreement to ensure a desired and favorable timeline for repayment. 

Both a seller and a buyer should hire a professional to prepare the contract and promissory note as well as discuss any matters that require further explanation or clarification. 

 Why Seller Financing is a Wise Move

Sometimes a mortgage isn’t easy to secure, and purchasing property under seller finance terms is a fantastic alternative in cases where there isn’t a clear path to move forward via a bank or financial institution. Accessing alternative forms of credit is an advantage for prospective buyers, and when a seller is financing a sale, oftentimes a property may command a higher sale price.

Aside from a quicker and less expensive way to buy a home, seller financing offers buyers the chance to save money on fees generally associated with traditional lending. In transactions involving only two parties, it’s appealing to be able to avoid many of the costs associated with conventional real estate transactions. 

Seller financing guarantees better terms than what a bank or financial institution would provide through their traditional lending options. A seller-financed deal may give a buyer more flexible terms, and access to more ideal financial options for their specific needs. 

Quick Guide To Common Types of Seller Financing

  • All-Inclusive Mortgage: Also known as an all-inclusive trust deed (AITD), this option offers the seller the option to carry the promissory note and mortgage on the entire balance of the home price deducting the down payment. 
  • Junior Mortgage: If there’s reluctance from a lender to finance more than 80% of a home’s values, sellers may extend credit to the buyer to make up the difference. The seller carries a second, or “junior” mortgage for the balance of the purchase price, deducting the down payment. 
  • Land Contract: Land contracts don’t involve passing the title to the buyer. Rather, the buyer is afforded an “equitable title,” or temporary shared ownership. A buyer will make payments to a seller, and once the final payment is received, the buyer receives the deed. 
  • Lease Option: This option allows a seller to lease a property to a buyer for a contracted term, much like ordinary rental property. However, a lease option lets a seller agree to sell the property to a buyer within an agreed-upon time frame and in return for an upfront fee. Varying terms under a lease option can be agreed upon between a buyer and seller, offering a flexible alternative to the traditional lending process. 
  • Assumable Mortgage: An assumable mortgage offers a buyer to take a seller’s place on the existing mortgage. In these scenarios, a buyer may assume a Federal Housing Administration (FHA) and Veteran Affairs (VA) loan, along with a conventional adjustable mortgage rate (ARM) with the bank’s approval. 

SRC Land works with customers to make the dream of owning land a reality. For over 20 years, we’ve offered seller financing options that work to put our customers on a clear path to a prosperous future by providing low down payments and affordable monthly payments regardless of bad or no credit. 

Let SRC Land offer you the best in seller financing options and an easier way towards realizing your dream of owning your own property.

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Bust These 4 Common Misconceptions About Land Values With SRC Land

When looking into land values in 2020, it’s no surprise that they can vary. Given the state of the current health pandemic we’re in, it only makes sense for the value of certain properties to fluctuate.

Several factors have created an uncertain market for land values such as an economy stuck in limbo and a stock market following suit, new land and trade laws, along with an unclear prediction of how the rest of this year will play out. Despite this, it’s imperative to have a good understanding of the concept of land values, especially if you’re thinking about purchasing property. 

Let the property professionals at SRC Land set the record straight on the most common misconceptions about land values for sale in Texas.

#1: Land Values Reflect the Stock Market

It was once a general rule of thumb that land values reflected the stock market. Over the years, however, this hasn’t been the case. There are numerous factors that affect the value of land in Texas, including natural disasters, local and national laws, commodity prices, rate of return, and more. While the stock market can be a good indicator of what direction the economy is going, it can’t be the primary factor you turn to for verifying land values.

#2: A Higher Demand for Crops/Livestock Means Higher Land Prices

This is not necessarily true. Even when a particular crop or type of land is in high demand, there are various outside factors that can keep the value of the land from increasing.

Even the highest quality land can be hit by forces outside of the land owner’s control. For instance, if you were a landowner in the forests of East Texas and the area was deep into a drought, this could harm the land value even when the demand for forest productivity–something that would increase this particular land’s value–is high.

#3: Decreases in Land Values Mean All Land Values are Suffering

While the majority of land markets are interconnected, there are many types of land that may thrive, even while others are doing poorly. For example, a drop in hunting can lower recreational land values.

While landed used for recreational activities like camping or ATV-ing hasn’t lost its appeal or popularity on the market, it is crucial to also take hunting into account when evaluating the overall land value.

#4: There’s No Guaranteed Way to Predict if Land Values Will Go Up or Down

Looking at the state of today’s land values, it’s natural to view them as unpredictable. While this holds some truth to a certain extent, there’s one surefire way to indicate what can increase the value of a property, and that is whether people move into the specific area surrounding the land. As the population rises in a given region, the demand for land will also typically increase. This boosts the desirability and price of the property. 

Let SRC Land Be Your Guide in Finding the Perfect Piece of Land

Land values can be complex. They can be tough to track, but understanding the common misconceptions about land values might give you a better idea of the value of your own land.

The best way to learn more about a property and its value would be to seek an experienced land consultant that knows the in’s and out’s of the local market while also taking the dozens of separate factors into consideration.

 

Don’t let misconceptions keep you from becoming a landowner. Contact SRC Land today to start your journey.

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Five Perks of Buying Land in Texas

Besides the rolling hills in Central Texas, vast fields of green in East Texas, and majestic mountains in West Texas, there are five other perks of purchasing land in Texas.

If you’re searching for land for sale in Harlingen or another Cameron County town, SRC Land can be your helping hand with their experience in decades of real estate and land development.

1. Property Tax Exemptions

When you purchase land in Texas, you may be eligible to qualify for a wildlife,  agricultural, and/or timber exemption. These exemptions can minimize your yearly property taxes significantly. The exemptions are given for land that’s utilized for agriculture, including for pasture and grazing land, timberland, and wildlife preservation. 

2. You Can Write Off Exemptions

Another financial advantage when it comes to buying land in Texas is that you may file a Schedule F in your federal income taxes. This applies to people who use their land specifically for farming.

What’s great about Schedule F is that it enables you to write off expenses assigned via farming, such as interest on a loan taken out to buy your land. On top of that, if you were to build on your property, you might be able to claim the interest on the construction loan in your federal income taxes.

3. You Can Invest and Profit Off of Your Land 

If your intent of buying land in Texas is to start your own business, you will discover that there are a plethora of businesses you can get into that you can’t in other states. You can consider opening an inn or bed and breakfast if your desire is to provide unmatched hospitality services, or you can go for a more rugged approach by opening up a hunting lodge and/or camping grounds. Whatever profitable venture you wish to achieve with the land you purchase is only limited by your imagination.

4. Financing in Your Favor

The majority of people aren’t in a position to raise the necessary funds to purchase land with only one payment. People that look to buy raw land also encounter an obstacle due to the fact that banks and other conventional lenders do not comprehend how this market works. One reason is that they may not have ways to accurately figure out the value of land as it is.

If you’re looking to buy land in Texas, you may borrow from lenders who finance the purchase and development of rural land in Texas. Certain financing companies are landowners and farmers who understand the necessities and difficulties that come with looking to buy land and engaging in agribusiness.

5. Extremely Affordable Rates

Getting the funds to buy land can be a challenge. The good news is buying land in Texas is very affordable. While rates from one area to another differ, generally speaking, purchasing land is a practicable investment that is far more affordable than buying or constructing commercial buildings.

Simple, Affordable, and Seller-Financed Land in Harlingen

If you’re looking to purchase land in Texas, you will not find better deals than those provided by SRC Land. We are a premier land development company, and we take pride in our affordable parcels of land available for sale in Cameron County.

 

If you’re searching for real estate in Cameron County, you can count on SRC Land to find the right place depending on your needs today.

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5 Reasons to Invest in Property in Cameron County

If you’re looking for a smart way to invest or a beautiful place to live, we recommend looking for real estate in Cameron County. There are lots of reasons to consider Cameron County, from its cost of living to its inviting atmosphere!

If you’re looking for land for sale in Harlingen or another Cameron County town, SRC Land can help with their decades of real estate and land development expertise!

1. The Results Are In!

The results are in, and US News has found that there are lots of things to love about Cameron County! Cameron County ranks higher than the rest of the country in some key areas that fall into three categories: education, health equity, and opportunities.

Education

The high school graduation rate is almost 5 percent higher than the national median, and racial disparity in education is half the national median. Cameron County also blows past the national average regarding Children Meeting Standards in Grade 4 ELA, 73 percent to 52 percent for the nation. Access to public education is also stellar in Cameron County, outpacing the national standard by nearly 10 percent.

Health Equity

Cameron County also ranks well when it comes to health equity, scoring a 3 compared to the national 16 on the Air Toxics Exposure Disparity Score, and falling at a .01 on the Premature Death Disparity Index compared to the national score of .07. On both indexes, a lower score indicates less disparity in health equity between racial groups.

Opportunities

Cameron County ranks .10 higher than the nation when it comes to the diversity of job opportunities in the area. This means that there are a wide number of industries represented in the county.

2. So Many Things to Do

According to Yelp, Cameron County has some pretty great things to do! 

The Sea Turtle is an aquarium located on South Padre Island that has a 5-star rating on Yelp and loads of adorable turtles! Black Dragon Cruises near Port Isabel also boasts a 5-star rating and allows Texans and tourists to live out a pirating adventure!

Bobz World in Los Fresnos has lots of things to do: with mini-golf, laser tags, dinosaurs, and astronauts, what else could you ask for? Maybe dolphins, I suppose, but you could find them nearby with The Original Dolphin Watch or the South Padre Island Dolphin Research and Sealife Nature Center, both of which are in Cameron County!

If you’re done looking at aquatic animals, you might want to spend some time with your furry friends. Well, Dean Porter Park is a lovely, Yelp 5-star park that’s the perfect place to take your dog for a walk or your family for a picnic. Or, if you want to do something a bit more wild, you could go to the Gladys Porter Zoo to see the lions, gorillas, flamingos, and so many more! 

3. Cost of Living and Housing

For the more pragmatically minded, Cameron County has its perks. Most importantly, you’ll save big on the cost of living.

According to the Brownsville Economic Development Council, the cost of living in the Brownsville area is 10 percent lower than the U.S. average, and in Harlingen, the cost of living is a whopping 26 percent lower than the national average.

According to the Harlingen Economic Development Corporation, the cost of housing in Harlingen is 45 percent lower than the national average.

4. Cameron County Has Great Places to Live

Niche uses crime statistics, public schooling, job opportunities, cost of living, and availability of local amenities to determine the best places to live in counties across the country. This information comes from the U.S. Census, the Centers for Disease Control and Prevention (CDC), and the Bureau of Labor Statistics, among other sources.

According to Niche, Palm Valley is the best place to live in Cameron County. Home of the Harlingen Country Club, this part of town has an excellent overall grade of A–which is followed by Rancho Viejo with another A score–but education does rank slightly lower. Harlingen ranks third, and Combes, Laguna Vista, Primera, Los Fresnos, and South Padre Island follow, each of them receiving a B ranking as some of the best places to live in Cameron County.

5. You Can Find Land For Sale in Harlingen with SRC Land

If you’re interested in investing in real estate in Cameron County, you can rely on the expertise of SRC Land to find the perfect lot or home for you. SRC Land’s experts Scot Campbell and Kevin Campbell have over 60 years of experience between them, helping buyers find land they can afford. One key component of that is seller-financing which our company provides to meet our clients needs.

 

If you’re looking for real estate in Cameron County, reach out to SRC Land to find the perfect place for your family today.

 

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