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Dodd Frank - Can private seller subordinate and carry back a second mortgage?

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  • Dodd Frank - Can private seller subordinate and carry back a second mortgage?

    Hi All,

    I have not done any seller financing since Dodd Frank and I am wondering what I need to be aware of....or even if I can still do this?

    Situation:

    Free & Clear House. (No Due On Sale Clause)
    My Private lender will loan me 60% for a 1st Position Only.
    Seller willing to subordinate and carryback the balance up to 5 years (would require a balloon to make the payments reasonable).
    I would find/sell to a tenant/buyer.

    Is this possible under DF?
    There is so much scattered info out there...I am just not clear?
    What do I need to do to comply?
    What are the pitfalls?

    Thanks!





  • #2
    No worries. You can do a Dodd-Frank type loan a year without any problem. If the house is free and clear it is the Seller who has to worry about Dodd-Frank *potentially*, but the Buyer doesn't have to worry. It might be simpler to do a Sandwich Lease Option anyway. If your lender is sort term (1 year or something like that) you have a timing issue. You need to know both the amount, the term, and the rate. Without all of the equation it is tough to know your options.

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