Free calculator

Seller financing calculator

Work out the monthly payment, total interest and balloon payment on an owner-financed deal, so you can structure a terms offer that works for you and the seller.

Deal terms

Purchase price

Down payment

Interest rate

Amortization

Balloon due after

Set the balloon to 0 if the loan fully amortizes with no balloon. Interest-only deals: enter the amortization equal to the balloon term and compare, or ask us about it on a call.

Monthly payment (principal and interest)

Down payment–

Amount seller finances–

Interest paid before balloon–

Balloon payment due–

Total paid to seller by balloon date–

How seller financing works

An estimate only. Taxes, insurance and any servicing fees are not included.

How the seller financing calculator works

Amount financed = price − down payment
Monthly payment = amount financed × r ÷ (1 − (1 + r)⁻ⁿ)
r = annual rate ÷ 12, n = amortization in months

Most owner-financed deals amortize the loan over a long period, often 20 to 30 years, to keep the payment low, but make the remaining balance due in a lump sum after a few years. That lump sum is the balloon payment. The calculator works out the balance still owed on the balloon date, which is what you will need to pay off by refinancing or selling.

A quick example

You buy a $200,000 rental with 10% down, so the seller carries $180,000. At 6% interest amortized over 30 years, the payment is about $1,079 a month. If the note has a 5-year balloon, roughly $167,500 is still owed at the end of year five. These numbers are illustrative only.

How to negotiate the terms

Price vs. terms: sellers often accept a full or higher price in exchange for a low rate or longer balloon. Decide which matters more to you.
Down payment: a larger down payment makes many sellers comfortable with a lower rate.
Balloon: give yourself enough time to refinance, usually 5 to 7 years or more.
Existing mortgage: if the seller still has a loan, read about the due-on-sale clause and wrap-around mortgages first.

Frequently asked questions

What is a typical seller financing interest rate?

It is negotiated, so it varies widely. Many deals land near or a bit above conventional mortgage rates, while sellers who care more about price may accept less. Check your state’s usury limits and any lending rules that apply to the seller.

Is seller financing a good idea?

It can help a buyer who cannot get a bank loan and a seller who wants steady income or a faster sale. Both sides take risk, so use a written note and deed of trust or mortgage, and have an attorney review it. Our seller financing guide covers the pros and cons.