In seller financing, the owner of the property acts as the lender. Instead of getting a bank loan, you make payments to the seller under terms you both agree to. It can open doors when a buyer does not fit a bank’s box, or when a seller wants steady income or a quicker sale. It also needs careful paperwork, so this is one purchase where an attorney is not optional.

How it generally works

  • The buyer and seller agree on a price, a down payment, an interest rate, a payment schedule and how long the loan lasts
  • A promissory note records the debt, and the property is typically secured by a security deed in Georgia
  • Payments go directly to the seller or through a servicing company
  • Many deals include a balloon payment, which means the remaining balance comes due on a set date, often after a few years

Why a seller might say yes

  • The seller owns the home free and clear and wants monthly income
  • The house is hard to finance because of its condition
  • The seller wants a faster or simpler sale
  • The seller expects tax advantages, which is a question for the seller’s own tax advisor

What a buyer should look at

  • The total cost over time, not just the monthly payment
  • Whether the seller has an existing mortgage, because that loan may include a due-on-sale clause
  • What happens if you cannot make the balloon payment
  • Title, insurance, property taxes and who is responsible for repairs
  • Whether the loan has to meet federal and state lending rules, which depend on the deal

Get an attorney involved early

Seller financing is where small drafting mistakes become large problems. Have a Georgia real estate attorney review the contract, the note, the security deed and the closing before you sign. If you do not have one, Nil can introduce you to an attorney from our network who is paid at closing.

How we help

We help you find sellers who may be open to terms, ask the right questions, and structure an offer that works for both sides. We work in Atlanta, Brookhaven, Decatur, Duluth, Ellenwood, Griffin, Hampton, Lawrenceville, Lilburn, Locust Grove, McDonough, Norcross, Snellville, Stockbridge, Stone Mountain and Tucker. We are not lenders and do not make loan decisions.

Get My Buyer Game Plan

Nil Patel is a licensed Georgia real estate salesperson with Keller Williams Realty Atlanta Partners. This page is general information, not legal, tax or financial advice, and nothing here is a commitment to lend. Talk to a lender and a real estate attorney about your own situation. Creative financing structures can carry legal, tax and lender-consent risks. Talk with a real estate attorney before you proceed with a subject-to, wrap-around, lease option or seller-financed purchase.