What Happens When a Buyer Defaults on a Seller-Backed Mortgage?


When a Buyer Defaults on a Mortgage You Hold, What Should You Do? What to do when a buyer defaults? Any decision to offer seller financing involves risk. Buyers do not seek seller financing when their financial situation enables them to secure traditional bank loans. That’s why sellers should: Secure a large down payment on a loan. Set an interest rate that’s higher than what banks can offer. Why? Because buyers who make higher down payments have more skin in the game. That makes a default less likely. Higher interest rates reflect the price a buyer pays for less-than-stellar credit. Even [...]