Re: Need professional help!!! - Posted by JohnBoy
Posted by JohnBoy on May 08, 2000 at 22:22:46:
You can buy on a contract with any seller willing. If you’ve made the rent payments on time and the landlord is ready to sell then a contract sale could be a good way to go.
Buying on a contract would make you responsible for paying principle and interest, taxes and insurance. You would take the agreed upon purchase price and interest rate and amortize that over 30 years just like a regular mortgage. If the seller only wants to carry for a few years then the terms of the contract would be for x number of years with the remaining principle balance due. During this time the taxes and insurance would be divided by 12 months for each year and paid in addition to the principle & interest. This could either be paid directly to the seller or set up to where the money is held in an escrow account. When the taxes come due each year the monies would be there to cover the taxes and paid from that. When the insurance comes due you would forward the annual bill to the seller or the escrow account to cover that cost to paid.
This would eliminate any repairs and taxes the landlord has to deal with since the buyer would be paying for all this just like they would when getting a mortgage through a bank.
The difference with buying on contract vs. a mortgage through a bank is that you wouldn’t get title to the property until the contract is paid in full. With a contract, title remains in the sellers name. The buyer has an equitable interest in the property.
You say your bankruptcy is 2 1/2 years old. There are lenders out there that finance with BK’s that are 2 years old from the date of being discharged. You need a good mortgage broker that works with a lot of lenders offering different types of programs for this. If your credit history has been good since the bankruptcy you should be able to obtain financing if you have the income to qualify on the amount you need for purchasing the home.