Seller financing (owner financing) = seller acts as lender for buyer, bypassing traditional bank. **2025 typical terms**: **(1) Down payment**: 10-30% (vs 20% conventional) - flexible negotiation.

Example: $400k property → $80k down (20%) + $320k seller note. **(2) Interest rate**: 6-10% (vs 7.5% bank avg) - usually 1-3% above prime. **(3) Loan term**: 5-10 years with **balloon payment** (full balance due).

Example: $320k loan @ 8% for 7 years → $2,516/mo (30yr amortization) but $276k balloon at year 7. **(4) Amortization**: 15-30 years (affects monthly payment) but balloon forces refi/sale before end. **Why sellers do it**: (a) $15-25k higher sale price, (b) 8% return vs 5% CD, (c) faster sale (30-60 days vs 6+ months), (d) tax deferral (installment sale spreads capital gains). **Buyer benefits**: (a) easier qualification (no bank underwriting), (b) faster closing (2-4 weeks), (c) lower closing costs ($2-5k vs $10k+), (d) flexible terms (negotiate everything). **Risks**: Seller = no lump sum + foreclosure hassle if default.

Buyer = balloon payment risk (must refi in 5-10 yrs, rates may be higher).