Re: ARM - Posted by Terry (Dallas)
Posted by Terry (Dallas) on May 01, 2000 at 15:49:41:
What does the seller want? Anything down? Moving money? Nothing? Could you take the house over subject to with a CYA letter to better protect yourself? If you are worried about the payments being made then use the escrow company or at the least get the coupon book and call every month to verify that a payment has been made. Get an authorization letter to obtain information from the bank. As far as the arm you should probably have enough of a spread from your payment to the owner to the payment being made to you. If the arm goes up, get the info from the seller. then the rent goes up when you are able. Up front option consideration, monthly spread and the back end spread should cover any adjustments to the arm. The other question is are there repairs to be made? Who will make them? Get the owner to make at least two payments, We both want me to have time to find the right tennant don’t we?, before your first one is due.
I would try HARD to just get the deed from him so you have no liability.
Hope this helps