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Ali and Josh Lupo bought their first property, a duplex in upstate New York, in December 2018. At the time, they were chipping away at six-figure student loan debt and looking for ways to lower their expenses. Owning, rather than renting, would allow them to "house hack," a strategy that involves renting out a portion of your home to cover some or all of your mortgage. They moved into half of the duplex, rented the other half, and immediately cut their housing cost in half. When the Lupos purchased a second duplex in 2020 and expanded from one rental unit to three, they began generating enough rental income to cover both of their mortgages, allowing them to live for free. The couple has continued to grow their real estate portfolio. As of November 2025, they said they own 14 long-term rental units. The cash flow, along with passive income generated from private money lending and dividend ETFs, allowed them to quit their full-time jobs and achieve financial independence in their mid-30s. Nearly all of their real estate investments have been seller-financed deals. With seller financing, the seller acts as the lender and provides a loan with agreed-upon terms to the buyer. Rather than paying the bank each month, as with a conventional loan, the buyer pays the seller. There are various advantages that come with seller financing for both parties. A significant benefit for the Lupos, as buyers, is the ability to lock in lower interest rates. "Right now, for an average investor who does a very cut-and-dried type of investment, if they go to a bank, they're probably paying 7.5%, maybe 7.75%, as far as a fixed rate 30-year loan," Josh told Business Insider. Related stories Business Insider tells the innovative stories you want to know Business Insider tells the innovative stories you want to know However, since they're able to negotiate the terms — including the interest rate — with the seller, "on all the properties that we've been buying, instead of paying 7.5%, we're paying 6% interest," he said, adding that the lower rate reduces their monthly payment and increases their cash flow. Additionally, when you work directly with the seller and bypass the bank, the process is typically quicker and less expensive, as there are no closing costs associated with the transaction. As for the seller, they're receiving a steady stream of passive income with each monthly payment, which can be especially beneficial to sellers living on a fixed income or who don't necessarily need or want a large, one-time lump sum from a property sale. How to find seller-financed deals The one big caveat with seller financing is the "due on sale" clause, which says that the bank can require the borrower to pay the remaining balance of the loan if there is a change in title. In other words, if the mortgage company sees there's a new owner, it will consider the home sold and can demand payment of the remaining debt in full. That means it's tricky for a seller to do seller financing if they don't own the property outright. As for finding seller-financed deals, "there's the formal and the informal way," said Josh. The informal approach boils down to networking — attending real estate meetups, engaging with other investors, and letting people know you're interested in seller financing — which is how the Lupos have landed deals. The more formal approach is to find "for sale by owner" listings on sites like FSBO.com or Zillow, where you can filter for "owner posted" listings. "There's software out there where you can find properties off market, and you can see who owns it, if they have a mortgage, how much equity is in the deal, and how long they've owned it," said Josh. He and Ali have mostly purchased from baby boomers who have reached, or are approaching, retirement and are more interested in receiving a monthly income, rather than a lump sum from the sale of the property. "These baby boomers that are retiring are like, 'We don't want to manage these properties anymore. We want to travel. We want to spend time with our grandkids.' But if they sell it all at once, they're going to get hit with a really big tax bill," explained Josh. Most of their deals are structured with a low down payment, between 5% and 8%, which has helped them scale quickly. In their experience, sellers have preferred to receive monthly payments for five to seven years, after which they want to cash out. That means, "we are going to have quite a few refinances, which is time and money," explained Ali. "Seller financing can get your foot in the door on a property in a creative way, but for most people, eventually, you do have to put it on a traditional mortgage." Just because a deal is seller-financed doesn't automatically make it an excellent deal, added Josh: "In real estate, seller financing is like the Holy Grail, and it can be really enticing." Early on, he and Ali nearly jumped on a property just because it was a seller-financed deal, but every time they calculated the cash flow, it was in the red. "Keep in mind that some people will say, 'Hey, I'll sell this to you seller-financed,' but when you actually run the numbers, they're charging you a premium, and it really doesn't make sense," he said.
