Hi again
I’m looking for some opinions/help on vendor financing. I don’t know exactly what it is. If I decide to go ahead with a purchase on vendor financing, what are the “normal” terms.
Cheers
Karen
Normally you’d pay a 2%+ premium on the interest rate of the person vendor financing you. If they’re paying 7% you’d probably be paying at least 9%. The length of the contract is usually the standard 25-30 years.
The security of a deal from the wrappees perspective is normally only as strong as the wrapper. So if you sign up with someone dodgy expect problems.
If you can avoid buying on vendors terms do it, I firmly believe you are much better off being the provider instead of the recipient. Even though it is a great avenue to get started and there are many who have used this method and plenty of good people doing vendor finance, I’d use it as a last resort only.
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