Real estate owner financing is a financial arrangement in which the seller of a property provides financing for the buyer. This type of transaction can be beneficial for both the buyer and the seller, as it allows the buyer to purchase a property without having to secure a loan from a bank, and it allows the seller to receive payment in full for the property while avoiding the cost of a real estate agent or other third-party fees. Owner financing can also be beneficial for buyers with bad credit, as the seller may be more willing to overlook credit issues. In an owner financing transaction, the buyer pays the seller a down payment, followed by regular payments over an agreed-upon term. The seller holds a lien on the property until the buyer has paid off the loan. The terms of the loan are often negotiable and may include interest, a balloon payment at the end of the term, and other conditions.