Seller financing, a previously shunned financial tool, is being reengineered with new structures for a new class of qualified borrowers
Seller financing has long existed on the fringes of real estate - a financial tool often shrouded in skepticism and seen as a fallback for unqualified buyers.
But Ryan Leahy (pictured), founder of MORE Seller Financing, said that the narrative is shifting fast.
“Seller financing lived in a dirty sandbox for most of its existence,” he said. “It was only designed for people that couldn’t qualify for a loan."
That stigma, Leahy argued, came from a lack of structure. There were no controls, no vetting, no clear standards - just desperate buyers and opportunistic sellers. But now, a mix of economic conditions and professional standardization is making seller financing not just viable, but attractive to a new class of financially qualified borrowers.
“Homeowners are sitting on tremendous equity for the first time - paired with historically low interest rates that we’ve never seen before.”
With most homeowners in major cities locked into mortgage rates below 3.5%, and current market rates hovering above 6.75%, many are unknowingly sitting on a powerful, invisible asset. “Seller financing can now be brought out of the shadows," said Leahy, adding that sellers can “use their current low interest rate as a strategic advantage - turning it into real value within the transaction itself.”
MORE Seller Financing has positioned itself at the center of this transformation by embedding traditional underwriting into every seller-financed transaction. “We’re the first company to establish a standardized process for seller financing,” Leahy said. “Every buyer should be fully pre-approved before an offer is considered - whether for a conventional, conforming, or even a non-QM loan. Sellers are coached on borrower reserves, credit scores, and potential red flags - empowering them to make informed decisions and evaluate offers with the same confidence and criteria as a traditional lender.
“If we feel that the risk is higher than the seller's risk tolerance... then we recommend not moving forward with seller financing for the transaction,” he said. “Even if the homebuyer can put 20% down.”
This marks a turn from the under-regulated past. “We partnered with two law firms that have closed more than 25,000 transactions in over 44 states and spent nine months building this program from the ground up,” he said. “When we brought it to legal teams, their response was, ‘This is incredible - it doesn’t violate any state laws.’”
Leahy said that safeguards are everything. Proper pre-approvals, legal documentation, mortgage servicing, proper insurance and awareness of how the due-on-sale clause works are non-negotiables in his model. “There’s always been concern about risk when a buyer makes payments directly to the seller and if the seller fails to make their underlying mortgage payment.”
Their solution: independent loan servicing and a clearly defined exit strategy, with enrolled lenders actively targeting buyers for refinance opportunities each month.
The value proposition, then, is twofold: it unlocks frozen housing inventory by enabling sellers to move, and it attracts more buyers who are highly qualified but underserved by conventional underwriting metrics.
“Most of our buyers are highly qualified, often self-employed individuals,” Leahy said. “They may earn significant income, but because of how they file their taxes, they don’t always qualify for a traditional mortgage. It’s not uncommon for someone to have millions in annual income and over a million dollars in reserves after their down payment - yet still be turned away by conventional lenders.”
That’s a seismic deviation from the old seller-finance borrower profile - and it’s giving rise to new deal structures. A seller with a 3% mortgage can offer a new buyer 5.5%, capture the spread, and offset the cost of a new 7% mortgage on their next home. “That home seller is making about $2,400 a month in monthly income,” he said. “When the seller now becomes a buyer... that effective interest rate becomes below 4% almost in every scenario.”
Yet, seller financing isn't the destination - it’s the bridge. Leahy positions it as “a temporary solution,” a three-year launchpad that can be hybridized with conventional tools.
The disruption here is as much cultural as it is technical. “As a loan officer, we don’t have any tools other than financial lending, which is not working,” he said. “With MORE Seller Financing, we’ve introduced a powerful new option that actually gets deals done.”
But success will hinge on education and a hard pivot from legacy thinking. “The biggest challenge is that mortgage professionals are accustomed to traditional financing structures,” he said. “We're using [seller financing] as a marketing tool to get conversations going with interested buyers.”
Regulatory risk still looms, but Leahy claims they’ve created the playbook to navigate it. “There’s a right way and wrong way to do seller financing,” he said. “We believe that we've created the absolute right way to do it and mitigate as much of the risk as possible.”
