Ask the expert:
 

I found someone who would love to buy my house and for nearly what I was asking, but they don't qualify for a conventional mortgage. Should I give them a mortgage using my own money?

 It's a leap of faith, of course, but sometimes seller financing is the only way to go. It has risks for both the buyer and seller, according to real estate attorneys. 
If the home is paid off, you won't have to deal with your own mortgage company. If not, check your mortgage to see if it has a "due on sale clause," meaning the lender can call the loan if the home is transferred. Some banks make exceptions, but many homeowners just take their chances. 
Seller financing was popular in the 1980s when mortgage rates reached 18 percent. Now it's making a comeback in markets that have been hit hard by foreclosures and where lending standards and years of economic distress have drained the pool of credit-worthy buyers.
About 52,990 U.S. homes were purchased with owner financing in 2010, up 56 percent from 2008, according to Realtors Property Resource. Michigan had the most of such sales, followed by Florida, Ohio, California, Wisconsin, and Minnesota, according to property website Truila. 
Most owner-financed mortgages are for five or seven years, at which time a balloon payment is due to retire the mortgage. This gives the buyer time to repair his or her credit rating, which was usually damaged by a foreclosure or a short sale. Some buyers are self-employed 
and can't show enough profit to qualify for a conventional mortgage.  Now, investors see seller financing as a marketing tool. For buyers who can put 20 percent down and pay a higher interest rate for a seven-year period, the investor makes a profit. 
One recent owner-financed mortgage on a $107,000 home included a $25,000 down payment and 7 percent interest.  If you have faith in the buyer, they have a good down payment and can afford the interest, go ahead and make the deal.