Posted by Tony-VA on November 15, 2000 at 06:06:52:
Hey Karl,
From my limited understanding of assumption…
When we assume the loan, we are simply adding our name to the loan as someone who will now be responsible to pay on it. (One would think banks would love to have someone else on the hook).
The sellers name remains because, essentially, it is the same loan, not a new one. I have heard people discuss qualifying for assumptions that may drop the sellers name and liability.
I agree, have the seller make the call to the bank. If I were to allow someone to assume my loan, I would want to know the exact details and my liability.
Again, this is from my LIMITED understanding with Assumption deals.
Question - how to convince seller… - Posted by DebraSC
Posted by DebraSC on November 14, 2000 at 20:15:26:
to let me lease/option an assumable loan and keep the loan in his name? He may be worried about me messing up his credit? He also wants me to send him a copy of the contracts we will be signing (he is living 3 hours away now and left his girlfriend to show the home).
Please help me. I told him I would send him (blank) contracts tomorrow.
Re: Question - how to convince seller… - Posted by Karl (OH)
Posted by Karl (OH) on November 14, 2000 at 21:04:18:
Debra,
Can you give some more details about this deal? Did you just bring up the idea of a lease/option with this seller and you want to make sure he realizes its a good deal for him? Does this seller have any other options? If he’s having trouble selling his home, then you’re giving him a solution to get out from under lot rent and the mortgage payments. If he’s motivated to sell (probably if he’s 3 hours away), hopefully he’ll see the wisdom of your “letting” him lease the home to you. Is he skeptical of the lease/option arrangement? If the loan is assumable, does he want you to assume it versus doing a lease/option? Or are you asking what is the best way to pitch a lease/option to a seller? Give us some more details about this deal and the specific problem you’re having with this seller.
Posted by DebraSC on November 14, 2000 at 21:27:28:
Thanks for your immediate reply, Karl.
I found this home with a for sale sign while cruising around a MHP. His loan is assumable by Oakwood Acceptance Corp. and he says he really wants to SELL the home, as in ASSUME the present loan, not LEASE/OPT it, although he admitted he didn’t know much about L/O and wanted to know more, and I told him more. My credit won’t allow me to assume the loan from the lender. Maybe I wasn’t clear in the advantages to him, but is there REALLY an advantage to him other than getting the loan out of his name? He doesn’t have time to move the home or even come up and sign a contract if we make a deal. I don’t know how long the home has been on the market. I offered him $500.00 consideration. He does not want equity out of the home. I offered him $500.00 consideration. Now what?
Does/will the PM allow L/O? - Posted by Blane (MI)
Posted by Blane (MI) on November 17, 2000 at 14:45:53:
Debra,
Do you have the PM’s blessing to possibly go this route? Nowhere in the posts do I see this. I tried this during summer, thought I had PM’s blessing and then got burned. Would hate to see the same happen to you.
Posted by Karl (Oh) on November 15, 2000 at 24:09:45:
Debra,
I recently looked into one mobile home with an assumable loan. I had the seller call the lender to find out exactly how the assumption worked. It turned out that he would still be responsible for the loan even if it was assumed. He was very surprised and very torqued off at the bank, and he never mentioned assumption again. I don?t know if this is typical for assumptions, but if this is true in your case, it would certainly help you negotiate. Maybe get the lenders phone number and call them yourself to find out.
Why offer him $500 consideration? Why not just take over his payments? He just wants out, right? Is there any equity in the home? Make sure he?s not upside down on the loan. If you?re going to take over this guys loan, the home must be worth more than is owed. If its not, ask this guy to pay down the loan. He may really be motivated, test him a little, ask questions. What if he doesn?t lease it to you? Then what? Winter?s about to hit! Does he know what can happen to an unoccupied home during winter? Have Dirk send some pictures of what can happen!
I?m by no means an expert, I?ve only done one lease/option deal. (Maybe I should have said that up front!) But just use your common sense to decide if its a good deal for you. Do you have Ernest Tew?s Getting Rich course? Its all about lease/option deals.
Tomorrow morning I would call Oakwood and find out how their assumption works. If the process sucks, it helps you sell your lease/option proposal to this seller. Since this seller thinks the assumption is his best option, I?d do the legwork to try to take that away from him. Then you become the best thing going.
He would save the 6-7% commission that a Realtor would get to sell the home for him.
No vacancy during the marketing period in which the home could be vandalized.
No lot rent during the marketing period with the home unoccupied.
Long distance to travel to sell or monitor the home himself.
Just a couple of ideas to start the creative thinking process.
Hope this will help,
Good ‘luck’
Robert