What is Cross-Collateralization?

Cross-Collateralization: 100% Financing Made Simple

Seller financing provides a direct, flexible approach to buying a home. Negotiate rates, set payment schedules, and enjoy a faster, more personalized path to making your dream home a reality.

What Is Cross-Collateralization?

Cross-collateralization allows you to use an additional property you already own as collateral to secure 100% financing on your new land purchase – no cash down payment required.

Instead of putting 20% down in cash, you pledge other real estate you own as additional security for the loan.

How it Works

Traditional Approach:

Purchase price: $100,000
Your cash down: $20,000 (20%)
Loan amount: $80,000

Cross-Collateralization Approach:

Purchase price: $100,000
Your cash down: $0
Loan amount: $100,000
Additional collateral: Your other property secures the loan

Your Property Is NOT Restricted

You maintain full control and can sell your properties at any time. Cross-collateralization does not prevent you from selling any of your real estate.

Selling Process When Cross-Collateralized

If you decide to sell your collateralized property:

Contact us before closing - We'll calculate the release amount
Release amount = Equivalent to what your down payment would have been
At closing - The title company will pay the release amount and we will remove our lien
You keep the rest - All remaining proceeds from the sale are yours
We reduce your loan amount - Your monthly payments will drop since you have reduced your principal owed.

Example:

Your collateralized property sells for $50,000
Release amount: $20,000 (20%)
You keep: $30,000 in proceeds
Your new loan amount is $80,000

Key Benefits

Preserve your cash for other investments or opportunities
Acquire more properties without depleting savings
Maintain flexibility to buy and sell as needed
Leverage existing assets to grow your portfolio faster

Requirements

All properties must have clear, marketable title and must be approved by our team
Properties can be in different states
Standard title work required on each property

Common Questions

Q: Can I use multiple small properties as collateral?
A: Yes, but we do not cross-collateralize properties with values under $50,000.

Q: Is this more expensive than the traditional down payment option?
A: Same interest rate and terms – you're simply using real estate equity instead of cash for security. There will be additional fees for the paperwork involved in the cross-collateralization.

Q: Can I use 100% of the property’s value towards a down payment?
A: No. We only credit you for what you paid for the property.