What Are Carryback Loans?

A carryback loan is a loan that is financed by the seller. A carryback loan is also known as a seller's second, or a seller carryback. This is usually done to ensure the sale of a home is complete. This kind of loan works well for people who do not qualify for traditional mortgage loans or those who cannot afford to pay for the closing costs associated with a typical mortgage. It can be the same thing as owner financing, and is commonly seen in for sale by owner situations. It does not always have to be the full purchase price of the home because it can also refer to the portion of the price that the seller will finance. These kinds of loans help sellers sell the home at the original sale price, rather than having to reduce the cost of the home to get it sold.