Updated October 1, 2021

An installment sale is exactly what it sounds like—a sale paid for in installments. While that might not strike you as anything out of the ordinary, it’s a huge boon to sellers who want to keep their income low for tax reporting purposes or even to avoid onerous capital gains taxes.

8 Key Benefits of an Installment Sale

• Flexibility
• Faster Sale
• Lower Tax Bracket
• Safety of Investment
• High Interest Income
• Easy Sale for Top Price
• Below Market Interest Rates
• Little to No Capital Gains Tax

From what we’ve described above, you might think that an installment sale primarily benefits the seller—and it certainly does—but the buyer of an installment arrangement can certainly benefit as well.

Despite these benefits, you might be wondering why anyone in any business would prefer deferred payments for something they’re selling. Why would anyone want to set up a structured installment sale if they can just demand to collect the entire purchase price up front. Even if an installment contract offers the benefits outlined above (which we will discuss), wouldn’t it be better—especially in a business like real estate—to just get a lump sum of cash to bankroll the next project?

Sometimes, yes. And many times, no. Installment sales can help circumnavigate a punitive tax on a capital gain (more on that later). Installment sales can be very beneficial for investors who are already established with a real estate portfolio and want to reduce their tax liability. It can actually be far more beneficial than just getting paid the contract price in full right away.

Before we go into the benefits of an installment sales contract, let’s take a look at what it is in broader terms, as well as an example of an installment payment arrangement in action.

What is an Installment Sale?

Most sales—from consumer purchases at the grocery store to home buying—involve a transaction where one party gives over a tangible item or right to a purchasing party, who offers an agreed-upon sum of cash in return. Usually the buyer provides the entire cash amount up front. Even if you’re buying a home, you will need to provide your mortgage company with a monthly payment. They will front the entirety of the selling price for you (minus the cash you offered as a down payment), in return for the promise of that payment. The same is true with large credit card purchases. The bank fronts the cash to the seller up front, and over time you can pay the bank back. Either way, the seller gets all their money at the time of the sale.

Based on your own shopping experiences, you might be aware that some businesses offer customers the opportunity to pay for an item in installments. As it turns out, that’s also a way for investors to buy and sell real estate or other sizable assets. This is called an installment sale, or in some cases, seller financing.

Instead of paying for something all at once, the buyer will make a series of annual payments. The only two conditions are that one payment must be made within a year of the tax year after the sale, and that the installment is recorded on Form 6252.

The method of purchase via installment sale is a valid means of revenue recognition according to the IRS and the Generally Accepted Accounting Principles. If a transaction is recorded as an installment sale, revenue and expenses can be tabulated at the time of cash collection, rather than at the time of the sale. As we will see, it creates a number of implications and offers that  offer both the buyer and seller certain benefits, especially for large transactions that might normally fall under a capital gains tax.

Incidentally, installment sale reporting is not the only type of deferred accounting structure on an adjusted basis recognized by the IRS. Businesses and investors can also space out the depreciation of an asset’s value over the course of some number of years to reduce their yearly burden for each and every tax year. If they eventually sell that depreciated asset, the IRS can collect their dues through a depreciation recapture, where the capital gain made from selling that asset is taxed as ordinary income instead of an actual capital gain (which in this case, would have a more favorable rate). The upshot of installment sales is that it allows you to spread out financial transactions over a period of years (if not decades), and it is a totally normal and legal business and accounting procedure.

How Does an Installment Sale Work?

As mentioned, there are only really two legal requirements you have to meet in order for an installment sale to be legitimately categorized for the books: the first installment must be paid within one year after the tax year of the sale, and the installment sale must be recorded on Form 6252 (a form offered by the IRS).

There are some restrictions regarding what cannot qualify for an installment sale. Inventory that is sold during the normal course of business can fall into the category of an installment sale. Of course, this seems to make sense for smaller consumer items, but what about more expensive items, like heavy machinery?

The bottom line rule is that inventory sold in the normal course of business does not qualify. This means, for example, that a company selling excavators (a piece of construction equipment that can run up to $500,000) cannot write off the sale of an excavator as an installment sale for tax purposes, even if the buyer purchases it by paying in installments.

Assets sold at a loss also do not qualify as an installment sale (for tax purposes), nor can stock sales. However, an installment sale can be used to purchase ownership interest in a company.

In most cases, if an installment sale is conducted, the seller of the asset in question will need to own the asset outright or free and clear. One reason for this restriction is that, in most cases, the lender on a property will not let the borrower sell off the property to another party because it would make it too difficult for the lender to seize the property as collateral if the borrower defaulted on their loan. Granted, in most states they would have legal recourse to do so, but a third party taking ownership of the property would create a legal quagmire costing the lender time and money to pursue.

So, usually free and clear ownership of a piece of real estate or a business asset is what’s needed on the part of the seller. After all, they are agreeing to transfer ownership of the property in question without receiving payment in full, up front. It’s also important to note that if the total aggregate of the installments will be above $5 million, the seller must place an interest charge on the sale (this number is lowered to $150,000 for the sale of individual residential real estate).

Let’s talk through an example of an installment sale.

George owns a strip mall outright, but the stress of managing tenants has become too burdensome, and he doesn’t feel like the property generates enough revenue to merit paying a property management company, especially because times are lean and he’s at a 75 percent vacancy rate with very little cash on hand.

George agrees to sell the property to Fred, a young investor with a twinkle in his eye, who is just at the start of his investing journey. Fred is a social media whiz and feels confident he can use his phone and a small advertising budget to attract new clients. In any case, Fred does not have enough cash to purchase George’s property outright, but George is motivated to sell, he likes Fred’s enthusiasm, and he wants to pay it forward to help a young investor get started.

So, George and Fred agree to an installment sale for $1.5 million total, to be paid over the course of 15 years to be reckoned as ordinary income (in other words, $150,000 per taxable year). This actually works out nicely for George, because he’s not interested in paying six figures in cash to the government as part of a punitive capital gains tax. It will also give him a nice six-figure income stream for fifteen years to come, and paying 18 percent income tax sure beats paying 25 percent income tax, which is what he’d pay if he were to get all that money in one year.

The details are a little more complicated than what we’ve presented, especially due to the size of the sale and because capital gains taxes and income taxes aren’t’ always cut and dry. Suffice it to say, an installment sale deal is a wonderful boon to the real estate investing community. If you’re curious about some of the details behind the sale that were not mentioned, you could ask a qualified accountant about capital gains tax strategies.

5 Key Benefits of an Installment Sale

Flexibility

Unlike a sale facilitated by a traditional lending institution, an installment sale is worked out between the seller and the buyer. They can work out the terms themselves, creating a deal that maximizes the benefits for both sides of the arrangement.

Buyers and sellers will most likely be helped by their respective lawyers when structuring this deal, but it will still have more flexibility than a deal made with the assistance of a traditional financial institution, like a bank, which will have their own interests to defend.

For instance, a bank may refuse to lend a buyer money if a building inspector finds some particular fault with the property, or if their team of analysts determines that the property is not a good investment. By contrast, two parties involved in setting up a sale along the lines of the installment sales method are not beholden to the interests and opinions of a qualified intermediary, and accordingly there is more flexibility to the deal.

Faster Sale

Since the buyer won’t have to rely on financial help from a traditional lender, they can skip a lot of the red tape around applying for and securing a mortgage—a process that can take months with all the underwriting and financial analysis.

In some cases, a bank can spend weeks analyzing a deal and then decide to reject the idea of financing it. With the possibility of structuring the purchase on an installment basis, a handshake and exchange of signatures can transpire within one day, if all the conditions are in place.

If not for the installment method, an eager buyer might find themselves bumped out of the picture and replaced by the first person who could secure traditional financing, or even a swing loan or bridge loan.

Lower tax bracket

One of the biggest benefits of an installment sale is that it helps the buyer place themselves into a lower tax bracket. The sale of some sizable property or property of sizable value—whether it’s commercial real estate or residential real estate—can bump an investor into a tax bracket they’d like to avoid.

Before you wonder about the ethics of what seems like a loophole for avoiding taxes, consider this: most investors see their income change year to year. It would not be fair for an investor with a fluctuating income to be hit by a tax rate meant for a higher income than they would normally make, denying them of money they may need in the following year or years, especially if business isn’t as good in the times ahead.

An installment sale allows real estate investors to pace out their income so that it isn’t associated with taxes that may pose a risk to the future of their business. And, of course, being in a lower tax bracket carries the additional benefit of saving money. In fact, most business people and real estate investors are already using itemized deductions to lower their gross profit and decrease their tax burden each and every taxable year.

Safety of Investment

An installment sale is a type of seller financing model where the original owner sells a property but does not collect payment all at once. This would be similar to a buyer obtaining a mortgage and paying for the property in one lump sum, but instead, they get the “mortgage” from the seller.

As it turns out, this creates a fairly secure income stream for the seller because the property itself remains as collateral. If the buyer reneges their agreement to pay or is no longer financially solvent, the seller can take back their property, just like the bank would.

Incidentally, there is also greater safety here for the buyer as well (depending on the deal and the seller). If they failed  to pay a bank-backed mortgage, their property would go into foreclosure, and in most cases there is little recourse to negotiate better terms that allow them to keep the property. With an installment sale, if worse comes to worse, the buyer may be able to renegotiate the terms of the sale with the seller—for instance, agreeing to pay more over time for a lower monthly payment, if times are tough. This type of flexibility is not always achievable with a large, institutional lender.

High Interest Income

Since the buyer and seller agree to space out payment for a property over the course of a number of years, they can negotiate an overall sale price and interest rate. This is a great opportunity for the seller to obtain an income stream with a locked-in interest rate, which may prove beneficial as an anchor in their overall portfolio, especially if they’ve placed cash in investments that fluctuate in value (such as stocks).

For example, a real estate developer could sell off parcels of developed land as they build, snowballing a massive stream of income and providing themselves with a more consistent stream of revenue over a longer period of time. This monetized installment sale can help the seller collect all the interest payments that would have otherwise gone to the bank or traditional lender. On the flip side, the buyer may be able to write off the interest they are paying as part of their installment obligation.

Easy Sale for Top Price

With seller financing, both the buyer and the seller can win. The seller has more leverage to get the price they want (or close to it) because the buyer does not need the cash up front. The buyer will have an easier time closing the deal because they can approach the seller directly and work out purchasing terms.

If you’ve ever tried to sell a piece of property (such as your own home), you know that getting the price you want can be very difficult. Chipping down the asking price is just part of the game, so much so that sellers will even factor that possibility into creating their advertised price.

Generally, when it comes to consumer residential transactions, the fact that the buyer will be presenting the seller with one lump sum reduces the seller’s ability to seal a deal as close to their asking price as they’d like. But a seller who will be financing the arrangement for the buyer through an installment note has more leverage to ask for the price they want. After all, if it weren’t for the seller holding the financing for the buyer, the buyer could not get what they want.

Keep in mind that the buyer probably will be coming to the table with some amount of cash up front—but this amount can be much lower than the amount they’d have to front when it comes to securing a traditional loan.

Below Market Interest Rates

If the buyer had to go to the bank or another type of institutional lender in order to get the capital to purchase the property in question, they would certainly be charged an interest rate on par with the market overall.

While interest rates for homebuyers tend to be on the lower end, interest rates for loans granted to investors can be higher because there is more risk involved. For one, an investor will have an easier time walking away from a property if things head south because it isn’t their personal residence. Commercial loans might also be extended for a shorter period of time.

These bridge loans or swing loans are really only meant to provide capital until the buyer can access more traditional financing. But with a seller backed sale agreed to be paid in installments, the buyer can secure a purchase with a below market interest rate, and certainly one below the high interest rates of swing loans and bridge loans.

Little to No Capital Gains Tax

Capital gains tax is a punitive tax that every investor wants to avoid as much as possible. If a deal is more than $469,051 (as of 2020), the going rate on capital gains income taxation is 20%. That number is simply staggering. Imagine making a million dollars on a deal and then having to pay $200,000 in taxes. Sometimes the capital gains tax rate is preferable, but those times are rare. In any case, the installment sale method can help investors avoid an unwieldy taxable gain.

Installment Sales are Important Financial Tools

Understanding installment sales is a must for anyone involved in real estate, whether they’re flipping houses or building a portfolio or rental properties. The installment sale is a great vehicle for deferring capital gains tax, creating a steady stream of income, and facilitating easy sales between motivated buyers and sellers.

Seller financing is often how professional real estate investors get started building their real estate portfolio. Many beginning real estate investors do not have large amounts of cash or the ability to secure traditional financing. This is where the flexibility of a seller financed property purchased through an installment sale can be beneficial, and it’s a strategy investors can continue to use (as both a buyer and a seller) as their investment portfolio grows.

An installment sale is exactly what it sounds like—a sale paid for in installments. While that might not strike you as anything out of the ordinary, it’s a huge boon to sellers who want to keep their income low for tax reporting purposes or even to avoid onerous capital gains taxes.

8 Key Benefits of an Installment Sale

• Flexibility
• Faster Sale
• Lower Tax Bracket
• Safety of Investment
• High Interest Income
• Easy Sale for Top Price
• Below Market Interest Rates
• Little to No Capital Gains Tax

From what we’ve described above, you might think that an installment sale primarily benefits the seller—and it certainly does—but the buyer of an installment arrangement can certainly benefit as well.

Despite these benefits, you might be wondering why anyone in any business would prefer deferred payments for something they’re selling. Why would anyone want to set up a structured installment sale if they can just demand to collect the entire purchase price up front. Even if an installment contract offers the benefits outlined above (which we will discuss), wouldn’t it be better—especially in a business like real estate—to just get a lump sum of cash to bankroll the next project?

Sometimes, yes. And many times, no. Installment sales can help circumnavigate a punitive tax on a capital gain (more on that later). Installment sales can be very beneficial for investors who are already established with a real estate portfolio and want to reduce their tax liability. It can actually be far more beneficial than just getting paid the contract price in full right away.

Before we go into the benefits of an installment sales contract, let’s take a look at what it is in broader terms, as well as an example of an installment payment arrangement in action.

What is an Installment Sale?

Most sales—from consumer purchases at the grocery store to home buying—involve a transaction where one party gives over a tangible item or right to a purchasing party, who offers an agreed-upon sum of cash in return. Usually the buyer provides the entire cash amount up front. Even if you’re buying a home, you will need to provide your mortgage company with a monthly payment. They will front the entirety of the selling price for you (minus the cash you offered as a down payment), in return for the promise of that payment. The same is true with large credit card purchases. The bank fronts the cash to the seller up front, and over time you can pay the bank back. Either way, the seller gets all their money at the time of the sale.

Based on your own shopping experiences, you might be aware that some businesses offer customers the opportunity to pay for an item in installments. As it turns out, that’s also a way for investors to buy and sell real estate or other sizable assets. This is called an installment sale, or in some cases, seller financing.

Instead of paying for something all at once, the buyer will make a series of annual payments. The only two conditions are that one payment must be made within a year of the tax year after the sale, and that the installment is recorded on Form 6252.

The method of purchase via installment sale is a valid means of revenue recognition according to the IRS and the Generally Accepted Accounting Principles. If a transaction is recorded as an installment sale, revenue and expenses can be tabulated at the time of cash collection, rather than at the time of the sale. As we will see, it creates a number of implications and offers that  offer both the buyer and seller certain benefits, especially for large transactions that might normally fall under a capital gains tax.

Incidentally, installment sale reporting is not the only type of deferred accounting structure on an adjusted basis recognized by the IRS. Businesses and investors can also space out the depreciation of an asset’s value over the course of some number of years to reduce their yearly burden for each and every tax year. If they eventually sell that depreciated asset, the IRS can collect their dues through a depreciation recapture, where the capital gain made from selling that asset is taxed as ordinary income instead of an actual capital gain (which in this case, would have a more favorable rate). The upshot of installment sales is that it allows you to spread out financial transactions over a period of years (if not decades), and it is a totally normal and legal business and accounting procedure.

How Does an Installment Sale Work?

As mentioned, there are only really two legal requirements you have to meet in order for an installment sale to be legitimately categorized for the books: the first installment must be paid within one year after the tax year of the sale, and the installment sale must be recorded on Form 6252 (a form offered by the IRS).

There are some restrictions regarding what cannot qualify for an installment sale. Inventory that is sold during the normal course of business can fall into the category of an installment sale. Of course, this seems to make sense for smaller consumer items, but what about more expensive items, like heavy machinery?

The bottom line rule is that inventory sold in the normal course of business does not qualify. This means, for example, that a company selling excavators (a piece of construction equipment that can run up to $500,000) cannot write off the sale of an excavator as an installment sale for tax purposes, even if the buyer purchases it by paying in installments.

Assets sold at a loss also do not qualify as an installment sale (for tax purposes), nor can stock sales. However, an installment sale can be used to purchase ownership interest in a company.

In most cases, if an installment sale is conducted, the seller of the asset in question will need to own the asset outright or free and clear. One reason for this restriction is that, in most cases, the lender on a property will not let the borrower sell off the property to another party because it would make it too difficult for the lender to seize the property as collateral if the borrower defaulted on their loan. Granted, in most states they would have legal recourse to do so, but a third party taking ownership of the property would create a legal quagmire costing the lender time and money to pursue.

So, usually free and clear ownership of a piece of real estate or a business asset is what’s needed on the part of the seller. After all, they are agreeing to transfer ownership of the property in question without receiving payment in full, up front. It’s also important to note that if the total aggregate of the installments will be above $5 million, the seller must place an interest charge on the sale (this number is lowered to $150,000 for the sale of individual residential real estate).

Let’s talk through an example of an installment sale.

George owns a strip mall outright, but the stress of managing tenants has become too burdensome, and he doesn’t feel like the property generates enough revenue to merit paying a property management company, especially because times are lean and he’s at a 75 percent vacancy rate with very little cash on hand.

George agrees to sell the property to Fred, a young investor with a twinkle in his eye, who is just at the start of his investing journey. Fred is a social media whiz and feels confident he can use his phone and a small advertising budget to attract new clients. In any case, Fred does not have enough cash to purchase George’s property outright, but George is motivated to sell, he likes Fred’s enthusiasm, and he wants to pay it forward to help a young investor get started.

So, George and Fred agree to an installment sale for $1.5 million total, to be paid over the course of 15 years to be reckoned as ordinary income (in other words, $150,000 per taxable year). This actually works out nicely for George, because he’s not interested in paying six figures in cash to the government as part of a punitive capital gains tax. It will also give him a nice six-figure income stream for fifteen years to come, and paying 18 percent income tax sure beats paying 25 percent income tax, which is what he’d pay if he were to get all that money in one year.

The details are a little more complicated than what we’ve presented, especially due to the size of the sale and because capital gains taxes and income taxes aren’t’ always cut and dry. Suffice it to say, an installment sale deal is a wonderful boon to the real estate investing community. If you’re curious about some of the details behind the sale that were not mentioned, you could ask a qualified accountant about capital gains tax strategies.

5 Key Benefits of an Installment Sale

Flexibility

Unlike a sale facilitated by a traditional lending institution, an installment sale is worked out between the seller and the buyer. They can work out the terms themselves, creating a deal that maximizes the benefits for both sides of the arrangement.

Buyers and sellers will most likely be helped by their respective lawyers when structuring this deal, but it will still have more flexibility than a deal made with the assistance of a traditional financial institution, like a bank, which will have their own interests to defend.

For instance, a bank may refuse to lend a buyer money if a building inspector finds some particular fault with the property, or if their team of analysts determines that the property is not a good investment. By contrast, two parties involved in setting up a sale along the lines of the installment sales method are not beholden to the interests and opinions of a qualified intermediary, and accordingly there is more flexibility to the deal.

Faster Sale

Since the buyer won’t have to rely on financial help from a traditional lender, they can skip a lot of the red tape around applying for and securing a mortgage—a process that can take months with all the underwriting and financial analysis.

In some cases, a bank can spend weeks analyzing a deal and then decide to reject the idea of financing it. With the possibility of structuring the purchase on an installment basis, a handshake and exchange of signatures can transpire within one day, if all the conditions are in place.

If not for the installment method, an eager buyer might find themselves bumped out of the picture and replaced by the first person who could secure traditional financing, or even a swing loan or bridge loan.

Lower tax bracket

One of the biggest benefits of an installment sale is that it helps the buyer place themselves into a lower tax bracket. The sale of some sizable property or property of sizable value—whether it’s commercial real estate or residential real estate—can bump an investor into a tax bracket they’d like to avoid.

Before you wonder about the ethics of what seems like a loophole for avoiding taxes, consider this: most investors see their income change year to year. It would not be fair for an investor with a fluctuating income to be hit by a tax rate meant for a higher income than they would normally make, denying them of money they may need in the following year or years, especially if business isn’t as good in the times ahead.

An installment sale allows real estate investors to pace out their income so that it isn’t associated with taxes that may pose a risk to the future of their business. And, of course, being in a lower tax bracket carries the additional benefit of saving money. In fact, most business people and real estate investors are already using itemized deductions to lower their gross profit and decrease their tax burden each and every taxable year.

Safety of Investment

An installment sale is a type of seller financing model where the original owner sells a property but does not collect payment all at once. This would be similar to a buyer obtaining a mortgage and paying for the property in one lump sum, but instead, they get the “mortgage” from the seller.

As it turns out, this creates a fairly secure income stream for the seller because the property itself remains as collateral. If the buyer reneges their agreement to pay or is no longer financially solvent, the seller can take back their property, just like the bank would.

Incidentally, there is also greater safety here for the buyer as well (depending on the deal and the seller). If they failed  to pay a bank-backed mortgage, their property would go into foreclosure, and in most cases there is little recourse to negotiate better terms that allow them to keep the property. With an installment sale, if worse comes to worse, the buyer may be able to renegotiate the terms of the sale with the seller—for instance, agreeing to pay more over time for a lower monthly payment, if times are tough. This type of flexibility is not always achievable with a large, institutional lender.

High Interest Income

Since the buyer and seller agree to space out payment for a property over the course of a number of years, they can negotiate an overall sale price and interest rate. This is a great opportunity for the seller to obtain an income stream with a locked-in interest rate, which may prove beneficial as an anchor in their overall portfolio, especially if they’ve placed cash in investments that fluctuate in value (such as stocks).

For example, a real estate developer could sell off parcels of developed land as they build, snowballing a massive stream of income and providing themselves with a more consistent stream of revenue over a longer period of time. This monetized installment sale can help the seller collect all the interest payments that would have otherwise gone to the bank or traditional lender. On the flip side, the buyer may be able to write off the interest they are paying as part of their installment obligation.

Easy Sale for Top Price

With seller financing, both the buyer and the seller can win. The seller has more leverage to get the price they want (or close to it) because the buyer does not need the cash up front. The buyer will have an easier time closing the deal because they can approach the seller directly and work out purchasing terms.

If you’ve ever tried to sell a piece of property (such as your own home), you know that getting the price you want can be very difficult. Chipping down the asking price is just part of the game, so much so that sellers will even factor that possibility into creating their advertised price.

Generally, when it comes to consumer residential transactions, the fact that the buyer will be presenting the seller with one lump sum reduces the seller’s ability to seal a deal as close to their asking price as they’d like. But a seller who will be financing the arrangement for the buyer through an installment note has more leverage to ask for the price they want. After all, if it weren’t for the seller holding the financing for the buyer, the buyer could not get what they want.

Keep in mind that the buyer probably will be coming to the table with some amount of cash up front—but this amount can be much lower than the amount they’d have to front when it comes to securing a traditional loan.

Below Market Interest Rates

If the buyer had to go to the bank or another type of institutional lender in order to get the capital to purchase the property in question, they would certainly be charged an interest rate on par with the market overall.

While interest rates for homebuyers tend to be on the lower end, interest rates for loans granted to investors can be higher because there is more risk involved. For one, an investor will have an easier time walking away from a property if things head south because it isn’t their personal residence. Commercial loans might also be extended for a shorter period of time.

These bridge loans or swing loans are really only meant to provide capital until the buyer can access more traditional financing. But with a seller backed sale agreed to be paid in installments, the buyer can secure a purchase with a below market interest rate, and certainly one below the high interest rates of swing loans and bridge loans.

Little to No Capital Gains Tax

Capital gains tax is a punitive tax that every investor wants to avoid as much as possible. If a deal is more than $469,051 (as of 2020), the going rate on capital gains income taxation is 20%. That number is simply staggering. Imagine making a million dollars on a deal and then having to pay $200,000 in taxes. Sometimes the capital gains tax rate is preferable, but those times are rare. In any case, the installment sale method can help investors avoid an unwieldy taxable gain.

Installment Sales are Important Financial Tools

Understanding installment sales is a must for anyone involved in real estate, whether they’re flipping houses or building a portfolio or rental properties. The installment sale is a great vehicle for deferring capital gains tax, creating a steady stream of income, and facilitating easy sales between motivated buyers and sellers.

Seller financing is often how professional real estate investors get started building their real estate portfolio. Many beginning real estate investors do not have large amounts of cash or the ability to secure traditional financing. This is where the flexibility of a seller financed property purchased through an installment sale can be beneficial, and it’s a strategy investors can continue to use (as both a buyer and a seller) as their investment portfolio grows.

Bonus Video