Re: Missing the first step! - Posted by Steve-Atl
Posted by Steve-Atl on June 16, 2000 at 10:48:21:
Banks will huff and puff about the due on sale clause, but in reality they only want to be paid as agreed. Faced with taking the house back or getting payments as agreed, they typically take the payments. If you handle it properly, there’s little real worry about the dreaded due on sale clause.
Here’s what I do in similar situations. I buy the property and place a loan on it. Then, I deed the property to my own trust. I can do that and the bank CANNOT call it due.
Then, I offer to sell the property with owner financing and use an agreement for deed or land contract. My trust keeps the title but the buyers have an interest in the property. I don’t record anything related to the agreement for deed unless I have to do it to satisfy the buyer. I collect a payment from my buyer each month and I send my payment to my lender, keeping the difference.
I get a good down payment from my buyer, a monthly cash flow, and a back-end profit when they refinance or sell. It doesn’t get any better. You just have to learn how to deal with the due on sale clause.