Seller Financing A Home With Bulletproof Trust
Seller financing is a type of real estate agreement that allows the buyer to pay the seller in installments rather than using a traditional mortgage from a bank. A lender, who is not the homeowner, will often reject seller financing if the home is contained in a non-statutory trust (i.e. Bulletproof Trust). This is a risk for the lender because the trust protects the home from seizure despite a home loan and foreclosure proceeding. The alternative is to sell the home using traditional lender financing from a bank (i.e. mortgage or HELOC), thus the home would be transferred out of the trust and into the lender's hands.
NOTE: If seller financing is required to complete the transaction, then the property must be exchanged from the Bulletproof Trust into an LLC using a Quitclaim Deed, often for $1 unless prohibited.
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