What is Seller Financing?   It is where the seller of the home agrees to provide the financing for the buyer, instead of making them go to the bank to get a loan.

Where the work of the traditional mortgage lender ends, the work of First Financial begins.  Simply put, First Financial wants to provide an opportunity for people wanting to own a home who are unable or prefer not to use a conventional mortgage.  Purchasing a home with Seller Financing provides the buyer an opportunity to establish a credit relationship, which in most cases enables them to ultimately obtain a conventional bank loan in a much shorter period of time.  Because this group of buyers brings with them a higher risk, they sometimes pay an interest rate that is a little more than for those with healthy credit histories.  But with a reliable 12 to 24 month payment record, the buyer can usually be converted to a lower interest mortgage.

Seller Financing has always been an important part of the home buying market in Iowa, Illinois and the entire United States. This method of financing provides people a hand up when frequently there is nowhere else for them to go.
 

Home Ownership Improves Lifestyles

Realty Times Feature Article by Broderick Perkins

Home ownership, says a new study, increases the chances of low-income kids attaining higher levels of education, reduces idleness, cuts the incidence of teen pregnancy, improves earnings, and reduces the need for welfare.

"The strongest and most consistent effect of home ownership is on educational attainment," according to a recently completed study conducted by the Institute for Policy Studies at Baltimore-based John Hopkins University.

"A child who always lived in an owned home is estimated to achieve nearly half a year of school more than a child whose parents were always renters. The likelihood of graduating from high school and of attending college are both about 10 percentage points higher for children who always lived in an owned home," said the study supported by the Fannie Mae foundation.

Joseph Harkness and Sandra J. Newman, institute professors who authored the study, say the reports findings have important implications for a boot strap housing policy.

"If home ownership in itself has a positive effect -- even in otherwise distressed neighborhoods -- then policies that enable poor people to own their own homes should be encouraged," the study says.

The positive effects of home ownership come somewhat from the extra equity income it generates, but more so from the stability it provides by reducing the number of times families move. When it comes to more education, fewer teen pregnancies and less welfare, household stability is key.

"We find that a large part of the positive impact of home ownership on children's adult outcomes is attributable to the greater residential stability that it causes," the report said.

"We also find that neighborhood effects, while small, are not negligible, and that children of home owners are more likely to benefit from good neighborhood conditions, and to be hurt by poor ones.

The study found:

• Compared to a child who never moves, a child who moves every year achieves approximately one year less of education, has a 25 percent lower probability of graduating from high school and approximately a 20 percent lower chance of obtaining post-secondary education.
• Continuous home ownership reduces the likelihood of idleness (not working, attending school or caring for children) by 5 percent.
• Continuous home ownership may reduce welfare dependence by about 5 percent.
• A 10 percent increase in the neighborhood home ownership rate is estimated to increase early adult annual earnings by $679.
• A 10 percent increase in neighborhood home ownership rate reduces a home owner's daughter's chance of a teen out-of-wedlock birth by 2.5 percent.
• A 10 percent increase in neighborhood residential stability reduces a home owner's daughter's chance of a teen out-of-wedlock birth by nearly 4 percentage points.
• The likelihood of a teen out-of-wedlock birth for children who move every year is about 10 percent higher than for children who never move.
• The likelihood of a family going on welfare for those who move every year is 15 percent higher than those who never move.

American Attitudes About Home Ownership