Posted by Allen on May 22, 2005 at 20:51:25:
The deal will be a Subject To, but how do I write this up? What kind of contract do I need? Will the title company or the Attorney supply the docs or do I have to?
Allen
Structure of First Deal? - Posted by Allen
Posted by Allen on May 22, 2005 at 06:20:25:
Here is what I am looking at. How do I put this together?
We have agreed to purchase price of $30K
Seller has a $25K mortgage that I want to take over because there is only eight years left on it. Balance to be paid in cash.
What contracts do I use for this deal? How do I sturcture the paperwork to take over the note?
Also as a side note: When she took out the mortgage, she took credit life insurance one the note. If I take over the mortgage, will the insurance still be in effect?
Re: Structure of First Deal? - Posted by Brent_IL
Posted by Brent_IL on May 22, 2005 at 14:19:03:
It appears that you?ll need a title insurance company to check for liens at the very least. Why not get title insurance and let the title company?s attorneys close the deal?
If you are taking over the mortgage, the lender will have assumption forms for you to fill out.
If you are taking over the payments on the existing mortgage, i.e., a subject-to transaction, it would be a good idea to make the payments directly to the lender or to use a third-party facilitator. The wording in you purchase contract is enough for escrow to write it up.
Keeping the old loan is a good idea since the deductions are insignificant when compared to the pay-down.
The credit life policy will end if you assume the loan. If it is subject-to, the policy is still in effect and covers the seller as the insured. Remember that she owns the policy and can change beneficiaries at will.