Re: Help with subject to existing morgage offer - Posted by TomC (Md)
Posted by TomC (Md) on March 03, 2000 at 23:53:30:
Jason: I think you need to slow down a little, unless you have had some conversations already with either the seller or Realtor about this. Too much too soon while blow the whole thing up.
First, on asking an agent to take a note for the commission: If the agent is an employee of a brokerage, you might have a hard time with this. This is because up to 50% of the commision can go to the brokerage, not the agent. The agent may not be even able to get the boss to take a note. Your best shot on a “note for the commision” deal is a self-employed broker, who does not need to answer to anyone else.
Second, it sounds like you are revealing too much of the process if you try to explain it in the offer. Also, do you have any idea if $117K is a fair price. If so, tell us how.
Just for kicks, how about this for a scenario (And I’m assuming this may be your first meeting on this property and the property will appraise for 117K):
First, convince the seller that they have the property sold. Do this by offering a “normal” contract that the realtor is used to seeing. Maybe offer just enough to cover the mortgage balance and commission, like $103K. Tell them that you will apply for a mortgage 1st thing on Monday. Make sure to include finance and inspection “weasel” contingencies. Give them a check deposit for $500, but in the contract have the wording that the check is not to be deposited until removal of the inspection contingency. Act with confidence that this deal will happen just like they expect.
If they bite on an offer where they would walk away at settlement with no cash, then you may have something. And if they accept it without a counter, you may have a motivated seller.
If they do accept it, you have accomplished one thing. You have made the seller feel relieved, since the house is now sold. In thier mind, the house is off the market.
Now you wait a few days, and get back in touch with the seller/Realtor. Tell them you have some financing issues, and you need to meet with them. Don’t tell them what the issue is over the phone.
Tell them in person that the financing may not go through, and then mention the idea of you “taking over the payments”. Get a reaction to that. Again, do not mention all that “Land trust mumbo-jumbo” (That is what the seller would call it if you try to explain it.)
Only after they agree to the “taking over you payments” idea, do you start talking about the exact mechanics of the transaction. Even better would be for you to already know a attorney or title co. to tell them what to do as the closing process gets under way.
Well, it’s late and I still have work to do, so I’ll stop here. I hope this gives you some ideas, and maybe you will get some more input from others.
Best of luck,