By the beginning of 2025, Carson Austin found himself increasingly anxious as his beautifully maintained 4,600‑square‑foot property in Georgetown, Texas, lingered unsold. For several months, the listing had attracted almost no meaningful attention, a fact that caused mounting concern. He had placed the home on the market for $1.6 million—a figure he believed to be both reasonable and competitive, reflecting the going rate for similarly expansive residences in the area. Yet despite Austin’s careful pricing strategy, the broader economic environment was working against him. Mortgage interest rates were stubbornly hovering near seven percent, making it prohibitively expensive for most buyers to borrow money and thereby dampening overall demand in the housing market. With transactions slowing and many prospective purchasers unwilling or unable to commit, Austin realized he needed to employ a different kind of tactic to set his listing apart.
Rather than continuing to wait and hope for a conventional offer, he chose to experiment with an unconventional yet increasingly relevant approach: seller financing. Under this arrangement, the homeowner temporarily assumes the role of the lender, extending credit directly to the buyer instead of requiring them to secure a traditional mortgage from a financial institution. This direct agreement typically takes the form of a short‑term note designed to bridge the gap until the purchaser can refinance. In Austin’s case, he refused to lower the sale price of his home, confident in its market value, but he introduced a powerful incentive—a significantly below‑market interest rate—intended to draw in discerning buyers sensitive to borrowing costs. The moment his listing advertised this creative financing option, interest surged almost immediately. Within just forty‑eight hours, the property was under contract. The buyer agreed to make a substantial down payment of thirty‑five percent and accepted the terms of a six‑year loan carrying a modest four‑percent interest rate. The deal progressed rapidly and closed only days later, assisted by a specialized company, MORE Seller Financing, which handled the vetting of the buyer, orchestrated compliance with legal safeguards, and coordinated a team of attorneys and transactional experts to finalize the arrangement.
Reflecting on the swift turnaround, Austin had no doubt about the decisive factor that sealed the sale. The buyer explicitly confirmed that the below‑market interest rate was the primary reason for their interest in his home. “I am completely certain,” Austin explained, “that the only reason the property sold as quickly as it did was because of the owner‑financing option.” His experience illustrated how a strategy once considered marginal or risky could suddenly become a powerful tool in a challenging market.
Seller, or owner, financing is not a new concept; it first gained widespread appeal during the 1970s and 1980s, when mortgage rates soared to punishing highs. At that time, it offered a practical workaround for buyers priced out of conventional loans. However, as the decades passed, the practice attracted criticism and developed a questionable reputation. Regulators and consumer advocates pointed to instances in which unscrupulous sellers used such arrangements to exploit low‑income individuals—often offering inflated interest rates on poorly maintained homes in struggling neighborhoods without adequate oversight or safeguards. These abuses tarnished the image of seller financing for years. Yet, the landscape began shifting again after 2022 as national mortgage rates climbed steeply. Confronted by expensive borrowing costs, both sellers and buyers sought creative methods to close deals, reigniting interest in this alternative approach. Although still a niche segment of the housing market, the practice is spreading upward into the luxury tier. Data from industry sources such as Realtor.com and Note Investor indicate that between 2023 and 2024, total sales volume involving seller‑financed arrangements rose by roughly eight percent, surpassing thirty billion dollars in value—a clear signal that this once obscure strategy is edging into the mainstream of upscale real estate.
Industry observers have taken notice of this shift. Joel Berner, a senior economist at Realtor.com, remarked that while seller financing used to occur predominantly in low‑end transactions involving underqualified buyers and distressed properties, the pattern has changed dramatically. Today, he explained, the typical sale using this model involves homes priced at or above the overall market median. In other words, what was once viewed as a fringe, even slightly dubious practice has ascended into the realm of high‑value transactions among financially secure participants. Increasingly, affluent sellers and well‑capitalized buyers are recognizing the mutual advantages of structuring deals this way.
The appeal lies in both opportunity and pragmatism. From the buyer’s standpoint, seller financing can open doors that traditional lending might close. Those who find themselves temporarily unable to qualify for a bank mortgage—perhaps because they are self‑employed, have unconventional income streams, or own significant assets but lack standard documentation—often see this route as a lifeline. Because the seller determines the loan’s conditions, these arrangements frequently feature interest rates below prevailing commercial levels, giving buyers breathing room while they wait for broader financial conditions to improve. For many, such a loan serves as a bridge, spanning an interim period of typically two to three years until they can refinance through a bank once rates decline. For sellers, the benefits are just as tangible. Rather than leaving a property stagnant on the market, owner financing can distinguish a listing from others, producing faster offers while simultaneously generating predictable monthly income through interest payments. It can also spare both parties a range of fees ordinarily associated with mortgages, such as origination charges and appraisals.
Ryan Leahy, the founder of MORE Seller Financing, characterizes the practice at its best as a symbiotic, win‑win scenario. In his view, sellers maintain more of their equity, craft a steady income stream, and exert control over the financing process, while qualified buyers gain access to affordable payments that might be meaningfully below standard market rates. Nevertheless, Leahy acknowledges that seller financing is not without risks. Complexities in legal compliance, buyer screening, and contract structure can expose both sides to serious consequences if handled improperly. To mitigate those hazards, his firm emphasizes education and oversight—ensuring that participants understand their obligations, that all documents align with state and federal lending laws, and that capable professionals such as licensed mortgage originators, attorneys, title companies, and servicing agents are involved from start to finish.
Experts note that this financial mechanism tends to attract well‑off buyers and sellers precisely because it demands stability and cash reserves. As Berner explains, the seller must possess enough liquidity and financial confidence to wait for full repayment of the sale price over several years. Meanwhile, the buyer must anticipate either an improvement in their borrowing circumstances or a decline in mortgage rates within that same period. Even with its recent resurgence, the approach still represents a niche within the overall market—fewer than one percent of real‑estate listings even mention private or owner financing as an option.
Within that specialized space, firms like MORE focus predominantly on upscale properties ranging from roughly $800,000 to $3 million. Their clients are individuals with substantial home equity, comfortable cash positions, and the patience to receive the proceeds of a sale gradually rather than all at once. Conversely, many of their buyers are entrepreneurs, independent contractors, or investors whose unconventional income sources—such as digital branding, cryptocurrency trading, or multiple small ventures—make it challenging to satisfy conventional mortgage lenders. Leahy points out that in the modern economy, numerous high‑earning individuals fall into this category. “There are countless people,” he observed, “whose income stems from self‑employment, influencer partnerships, or side businesses that banks simply don’t know how to quantify. For them, seller financing is not a fad—it’s a necessity that’s here to stay.”
Another example underscores this versatility. One of MORE’s clients decided to utilize seller financing while marketing his multi‑million‑dollar residence in Austin, Texas. Unlike buyers of limited means, his potential purchasers were affluent and perfectly capable of buying with cash. Yet even they hesitated. Many preferred to keep their capital invested elsewhere—whether in equities, private ventures, or other high‑yield opportunities—rather than tying up millions in real estate during a period of elevated borrowing costs. Recognizing this mindset, the seller, identified as James S., structured a creative solution: he offered a three‑year loan at an attractive interest rate of 5.5 percent to accompany the property’s $2.9 million sale price. The transaction closed in January 2025, demonstrating that even wealthy buyers value flexibility when navigating uncertain financial conditions. As James later reflected, such choices come down to strategic allocation: some individuals would rather deploy their funds in the stock market or entrepreneurial pursuits than commit them entirely to a home purchase.
For James and his wife, the arrangement carried its own advantages. Having not yet decided on a new residence, they were content to live temporarily in furnished short‑term rentals in California while their former buyer steadily paid down the loan. In the meantime, the couple enjoyed receiving a modest but consistent stream of monthly income along with the satisfaction of seeing their mortgage balance diminish over time. “Our loan is being reduced every month,” James explained, “and we earn additional money in the process. It’s a comfortable situation—financially beneficial and surprisingly low‑stress.”
Together, these experiences illustrate how seller financing, once regarded as a relic from another era, has evolved into a sophisticated instrument within modern real estate. Enabled by educated participants, professional oversight, and a changing interest‑rate environment, it offers both flexibility and opportunity to those willing to think beyond conventional lending boundaries.
Sourse: https://www.businessinsider.com/wealthy-home-sellers-making-risky-offers-drum-up-buyer-interest-2025-12
