Seller Financing in Tremont & East Tremont, Bronx: Skip the Bank

Today's bank rate vs. a typical seller-finance rate

When a Tremont & East Tremont owner sells with financing, the owner becomes the lender. Most owners price that loan off what banks charge: homeowners typically ask about 2 percentage points more than the national average 30-year rate, with a 5-year balloon payment, or an extension if both sides agree to one in the contract. The numbers below update every week.

About Tremont & East Tremont

Tremont and East Tremont follow East Tremont Avenue as it runs east from around Webster Avenue toward West Farms, with Crotona Park to the south and Bronx Park, home of the Bronx Zoo, to the north. In the 1950s the Cross Bronx Expressway was cut directly through these blocks, a project that removed whole rows of apartment houses and is still cited as a cautionary example of highway-era planning. The sunken trench of the expressway remains the clearest dividing line in the area, with overpasses connecting the streets on either side.

The decades after the highway brought disinvestment and empty lots, and the rebuilding that began in the 1980s gave the area much of its current look. Rows of brick two- and three-family houses, many with parking pads out front, now fill blocks that once held tenements, often built through city homeownership programs. East Tremont Avenue serves as the main shopping street, with groceries, pharmacies and small restaurants, and Third Avenue adds more stores and bus lines. The Metro-North Tremont station near Park Avenue offers a direct ride to Grand Central.

Getting around: 2 and 5 at West Farms Sq-E Tremont Av and E 180 St; Metro-North Harlem Line at Tremont; B and D at Tremont Av on the Grand Concourse to the west

What you will find for sale

• Brick two- and three-family rowhouses from the rebuilding years that began in the late 1980s, set on once-vacant lots with front parking pads.
• Prewar five- and six-story walk-up buildings on the blocks the expressway did not reach, many with storefronts on the avenues and fully residential floors above.
• Older attached brick and frame houses, some dating to the early 1900s, survive on scattered side streets between the newer construction.
• Mixed-use buildings along East Tremont Avenue and parts of Third Avenue, typically two or three floors of apartments over a row of shops.

Why seller financing fits Tremont & East Tremont

Many of the newer houses here were built for first-time owners, and they now resell to buyers in a similar position: steady work, sometimes several income sources, but not always the clean W-2 history a lender wants to see. Someone who drives for a living, runs a small cleaning business or rents out a room may earn enough to carry a three-family house with help from its rental income, yet still be turned down because the bank discounts those earnings. Thin credit files and recent job changes stop other buyers before an appraisal is even ordered.

Owners who bought these houses new in the 1990s have often paid off their mortgages or are close to it, and some are now ready to retire somewhere quieter. A monthly note payment can replace the rent they used to collect from their tenants, without the repairs and turnover that come with being a landlord. Some houses were originally sold with resale or occupancy restrictions that have since expired, giving owners more freedom in how they sell. Heirs settling an estate face the same short list of bank-qualified buyers for a three-family house and may find a note the more practical exit.

The 5 terms you will negotiate

Every owner-financed deal comes down to five numbers. Here is what each one means, what is typical in New York City right now, and how they work on an illustrative 3-family brick rowhouse (built in the 1990s) in Tremont & East Tremont.

How to buy owner-to-owner in Tremont & East Tremont

1. Find owners open to financing. Start with Tremont & East Tremont properties on the SellerFinanceNYC live map, where every listing is checked against ACRIS deed and mortgage records. Owners who have held a building for decades with no open mortgage are the most likely to carry a note.
2. Offer on all five terms at once. Price, down payment, rate, amortization and balloon trade off against each other. Put them in a short written term sheet so nothing gets lost.
3. Hire a New York real estate attorney. Your attorney drafts or reviews the contract of sale, the promissory note and the mortgage, and confirms the seller has no existing loan with a due-on-sale clause. See our guide to finding an attorney.
4. Do local due diligence. In Tremont & East Tremont, check:
   • Homes built through city or nonprofit homeownership programs may still carry an HPD regulatory agreement, deed restriction or recapture clause, so your attorney should search the title for anything still in force.
   • Blocks next to the Cross Bronx Expressway see heavy truck traffic and noise; visit at rush hour and check window quality and ventilation in any house close to the trench.
   • Check whether the current property tax bill reflects an exemption tied to new construction or rehabilitation that is phasing out, so a higher bill after closing does not catch you off guard.
   • In two- and three-family houses, confirm each unit is legal on the certificate of occupancy, since extra basement apartments are a frequent source of violations and lost rent.
   • In prewar walk-ups covered by rent stabilization, verify legal rents through DHCR registrations rather than relying on the rent roll the seller provides.
5. Close like a normal sale. The deed transfers to you, you sign the note, and the seller's mortgage is recorded with the City Register. Buy title insurance, and consider a loan servicing company to collect payments and escrow taxes and insurance.
6. Plan the balloon from day one. Use the five years to build a payment record, fix up the building and document income so you can refinance well before the balloon is due.

Questions buyers ask about Tremont & East Tremont