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Are you are a seller having trouble selling your property? I can guarantee you that a big part of the problem is that buyers in general are having a hard time getting financing. This is reducing your number of potential buyers. So why not eliminate the obstacle? Why not sell utilizing a lease-option or a wrap-around deed of trust or an assumption – with or without lender approval? Why make the buyer go get a new loan? Let the buyer use your loan.

In the old days almost all residential bank loans could be assumed or “wrapped around” or “taken subject to”.  Then in 1986 Congress passed the Garn St. Germain Act. The due-on-sale clause in paragraph 17 or 18 of your deed of trust became enforceable under federal law. Most real estate brokers are afraid to “go around” a due-on-sale clause. Most tell buyers they have to get financing so the seller can pay off his or her loan. However, seller financing can work, although it has to be done carefully and with full disclosure to all parties.

In a seller-financed deal the buyer makes monthly payments to a collection service. The collection service pays the lender in the seller’s name and keep a record of everything. The buyer will pay a reasonable down payment – sometimes even enough to pay for closing costs and commissions and maybe enough to cash out the seller’s equity in the property.

Bear in mind that VA and FHA loans are assumable, provided that the buyer proves credit worthiness by customary credit standards, which may be less strict than standards for new loans – because often the seller is not released from liability, which means the lender will have two parties liable to pay the mortgage.

If you are a broker working on a deal where the seller is willing to “carry a contract”, don’t be shy about calling.

Click here to sign up for my email list.

James Robert Deal, Broker and Attorney
Broker with Agency One Realty LLC
WSBA # 8103, DOL # 39666
425-774-6611, 888-999-2022
James at James Deal dot com

 

Freddie & Fannie’s Mortgage Shell Game

Welcome to Freddie and Fannie’s Mortgage Shell Game By Shawn Timothy Newman, J.D. Adjunct Professor Saint Martin’s University In common parlance, a...

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Click here for links to articles about mortgage modification.

Click here to read about my back ground as an attorney. (link toabout me under jamesrobertdeal.com/aboutme

Click here to read about my background as a mortgage broker. (link to about me under dealmortgage.net/aboutme)

Click here to read about my pro bono work as an environmental attorney working against water fluoridation. (link to fluoride)

More about mortgage modification:

Who qualifies for mortgage modification? (link to More Information About Mortgage Modification)

Factors Which Affect the Mortgage Modification Outcome

What We Shoot For in Mortgage Modification

Some Examples of Modifiable Loans

Can You Handle Your Own Mortgage Modification?

Attorney-Based Mortgage Modification vs. Non-Attorney-Based Modification

When Should You File For Bankruptcy?

Modification of Credit Card Debt

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