how does owner financing work

It varies slightly from state to state and here Texas, owner financing happens when the owner of a home leaves the existing mortgage in place (via Wrap Mortgage) or owns it free and clear and provides a new mortgage to the buyer. This is different from a conventional loan because no banks get involved and the pre-approval process can happen very quickly. Owner financing is not a new thing to the market, it only becomes popular when the banks make it difficult to qualify for a traditional loan.