Posted by JPiper on February 13, 2000 at 11:40:40:
Just an opinion?but I think you might get a better answer to these questions if you posted them separately?.so if this doesn?t answer them you might try that.
The way I would handle the ?wrap? situation is to pay the impounds myself, and collect them from the new buyer. In other words, just set up a situation that mirrors the underlying impound account. Make certain you have language that permits the changing of these impound amounts as the insurance and taxes change.
Whether you have a continuing liability on this second may well depend on the law in your state. California as an example has a ?one action rule?, which means that the lender may foreclose either judicially or non-judicially?.but not both. The implication therefore is that lenders foreclosing non-judicially in California cannot get a deficiency judgment, and must look only to the property for their remedy for default. Even if a lender in California forecloses judicially, no one who seller finances may collect a deficiency judgment on purchase money deeds of trust. Further, institutional lenders for properties of 4 units or less are not allowed to pursue deficiency judgments on purchase money in California. However for other cases than these, even in California lenders can pursue deficiency judgments.
In my state (Missouri), there is no ?one action rule?. A lender can pursue deficiency judgments on purchase money providing they go through the right steps. So the answer to your question is going to depend on the state law. Check with an attorney, not your broker.
Finally, in terms of the financing of your buyer, I would want a stipulation in the contract that provided for a requirement that the buyer to be issued approval quicker than 30+ days?.and upon that approval I might require the buyer to go ?hard??.that is, require a non-refundable deposit. In the event that you do this, you might also want to have this passed through to you?.since it may be difficult to get it out of the title company if the buyer backs out of the deal. Whether you can negotiate any of this with your buyer is another question.