Vendor Take-Back Mortgage
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. Investopedia Says:
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. Related Terms:
Financing
Lien
Mortgage
Second Lien Debt
Silent Second Mortgage |