Seller Held Loan

A mortgage loan, usually subordinate to a primary loan, that the borrower-buyer owes to the property seller. The seller-held loan is sometimes used to help a marginal borrower qualify for a purchase mortgage loan. For example, it is feasible for a buyer to purchase a home with an 80% LTV conforming first mortgage loan, along with a 10% LTV second mortgage owed to the seller—the remaining 10% would then be the down payment. This is another form of creative financing. For more information, see the "Buying Real Estate with Seller Financing" article in the "Creative Financing" section.

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Real Estate 101

Real Estate 101

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