THE SCENARIO
I was talking with friends recently who are selling a house they own in another state. They had a couple of offers on the table, but were strongly leaning toward taking the one that involved taking payments over time instead of getting a huge pile of money on the close of escrow. (This is called 'seller carry', 'selling on terms', and 'seller financing', among other terms.)
The house is being sold for $85,000 with $5,000 down, and the balance is being financed at 10% for 154 months, at which point the buyer will own it outright. The question, then, is 'How much money is the buyer going to give the seller every month for those 154 months?'
THE SOLUTION
First things first, make sure the calculator is using 12 Payments per Year.
N: 154
I/YR: 10
PV: -80,000 (th...
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