Posted by Stacy (AZ) on February 16, 2001 at 10:21:37:
First, I don’t see title insurance mentioned anywhere. If it was my deal, I’d get it.
Second, if you are owner financing your buyer, don’t assign the beneficial interest of the trust to him. This gives him ownership! You need protection, since you are on the hook to make the seller’s mortgage payments in this deal. What happens if the buyer stops making payments? How will you get the property back if you’ve simply assigned the bene interest to the buyer?
Sell it with an L/O, a Land Contract, or an AITD so you have legal recourse (eviction, forfeiture, or foreclosure). I prefer the Land Contract route, since I can get more down, and normally a higher monthly payment than an L/O, and in my state I can get the property back quicker than with an AITD.
Good Deal? Do I Need Escrow For This? - Posted by Gary (CA)
Posted by Gary (CA) on February 16, 2001 at 02:56:42:
I am purchasing a condo that is one month behind in payments. Seller is willing to sell ‘subject to’ the first TD ($104k). Will need $1000 to reinstate 1st TD and HOA fees. Property worth $115k - $120k after repair. About $10k - $15k in equity.
If all the seller wants is $500 to walk and is willing to place property in land trust and assign beneficial interest to me (to ‘get around due-on-sale clause’), ==> is there any reason to escrow this since other than the $500, no money is changing hands?
My exit strategy is to sell (flip) as a NO BANK QUALIFIER and have my buyer pay me a down payment of $9k and make payments on the ‘subject to’ 1st TD ($104k) and I will re-assign beneficial interest to this new buyer. My only risk here is the $500. I will only reinstate the first TD when I find my buyer. This second deal will be done in escrow. ===>Is this a good deal?