Posted by Jim Simons on January 07, 1999 at 23:16:11:
Hi Hector,
Just a thought here. It seems to me if all the correct paper work was done and everything was filed as it should be, you would have recourse to collect or foreclose. After all by contract, you should be named and registered as a legal lien holder.
However, I think I also remember a situation like this comming up in Carleton Sheets RE Course. As best I can remember, one possible solution was to use a Good Attorney or Title Company to act as intermediary. They Collect funds from the Buyer and then disperse funds to each party. This way not only do you have a record of what was paid and how, but also, if they don’t pay, the Attorney or Title Co. can pursue them.
Question When Seller-Financing - Posted by Hector Zuniga
Posted by Hector Zuniga on January 07, 1999 at 19:03:46:
I have a SFR that the buyer wants me to take a second mortgage and he can qualify to assume the first mortgage. What recourse do I have if he continues to make the first mortgage payments but stops his payments to me? Any suggestions as to prevent me from getting into this predicament?
Re: Question When Seller-Financing - Posted by Kristin
Posted by Kristin on January 08, 1999 at 17:29:01:
Hector,
One other thing to consider:
In some cases, the buyer will stop making the first lien payment,and continue to pay the second. In that situation, the first lienholder could foreclose and wipe your lien. The best way to prevent this from happening would be to tie your second to the first, so that in the event that the first is not paid, both liens foreclose simultaneously, and your interest is protected. Your real estate attorney should be able to write this clause into the lien, and work with the first lienholder to get their approval.
Good luck,
Kristin
You can foreclose if it’s worth it. But, to prevent it
have the buyer make one payment to a third party collection service, and they will send out two checks
one to the first lienholder and one to the second lienholder(you), and notify you if the payments aren’t made. Email me if you need more details.