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Vendor Take-Back Mortgage

Home Ownership by Country

Home Ownership by Country

Vendor Take-Back Mortgage

What is a 'Vendor Take-Back Mortgage'

A vendor take-back mortgage is a type of mortgage in which the seller offers to lend funds to the buyer to help facilitate the purchase of the property. The take-back mortgage often represents a secondary lien on the property, as most buyers will have a primary source of funding other than the seller.

Explaining 'Vendor Take-Back Mortgage'

In most cases, the take-back mortgage is offered at a rate below market value. This makes the option more attractive for the buyer, which can translate into a fast sale for the seller because another source of financing is being offered. Take-back mortgages often allow buyers to purchase property valued above their traditional financing limits.


Vendor Take Back Mortgage FAQ

What is a vendor take back note?

A vendor take-back (VTB) (or “vendor financing”) is an additional potential method to finance an acquisition transaction. It is usually documented by a vendor take back note or promissory note. In this arrangement, the vendor loans a part of the purchase price to the purchaser.

How do I back out of a mortgage before closing?

Cancelling your mortgage loan before closing on it is easy; just tell your lender you want to cancel it. There may be a cancellation or similar fee for cancelling your mortgage loan. And you'll need to decide what to do about your home purchase the moment you back out of your mortgage loan.

How do you sell a house and hold a mortgage?

To hold a mortgage means the current owner has agreed to extend credit to a buyer purchasing their home, land, or other real property. The buyer makes a down payment already agreed and pays monthly loan payments directly to the seller instead of a bank.

Is owner financing a bad idea?

The disadvantages of Owner Financing are: Higher interest: It usually charges interest higher than a bank's. Due-on-sale clause: If the seller has a mortgage on the property, his bank or lender can demand immediate payment of the debt in full if the house is sold (to you).

Can I sell my house with owner financing if I have a mortgage?

A homeowner with a mortgage can offer seller-carried financing but it's can be difficult. Home sellers, looking to increase their buyer pools, might offer seller-carried financing, even with mortgages on their homes.

Further Reading

Residential mortgage lending in metropolitan Toronto: a case study of the resale marketResidential mortgage lending in metropolitan Toronto: a case study of the resale market
onlinelibrary.wiley.com [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

Housing finance in early 20th century suburban TorontoHousing finance in early 20th century suburban Toronto
www.erudit.org [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

Local strategies in resale home financing in the Toronto housing marketLocal strategies in resale home financing in the Toronto housing market
journals.sagepub.com [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

The Contract for Deed as a Mortgage: The Case for the Restatement ApproachThe Contract for Deed as a Mortgage: The Case for the Restatement Approach
heinonline.org [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

Substitution or complementary effects between banking and stock markets: Evidence from financial openness in TaiwanSubstitution or complementary effects between banking and stock markets: Evidence from financial openness in Taiwan
www.sciencedirect.com [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

Vendors and Purchasers-Damages-Real Estate Purchaser Entitled to Increased Mortgage Interest Costs as Damages from Seller Who Breaches Sales ContractVendors and Purchasers-Damages-Real Estate Purchaser Entitled to Increased Mortgage Interest Costs as Damages from Seller Who Breaches Sales Contract
heinonline.org [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …

A Financial Revolution in AgricultureA Financial Revolution in Agriculture
heinonline.org [PDF]
… increase in R2 when Italian was added to income in the total private-individual financing and the private vendor-take-back models … Of particular interest is the importance of ethnicity, independent of economic status, in accounting for the spatial variations of mortgage lending in …


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