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Buyers and sellers

Why homebuyers choose alternative financing

Source: The Pew Charitable Trusts
Report date: April 2022

A survey by the Pew Charitable Trusts looks at why millions of Americans use alternative financing instead of traditional mortgages to buy homes. Pew includes seller-financed mortgages, personal property loans, lease purchase agreements and land contracts as alternative financing methods.


  • 1 in 5 homeowners, about 36 million Americans, have used alternative financing – most commonly personal property loans – at least once.

  • 22% of homebuyers who've used alternative financing have used two or more types.

  • Broken down by race and ethnicity, 34% of Hispanic borrowers have used alternative financing, followed by 23% of non-Hispanic Black borrowers and 19% of non-Hispanic white borrowers.

  • 23% of borrowers who use alternative financing earn less than $50,000 annually.

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