Posted by Ed Copp (OH) on February 24, 2001 at 11:44:26:
All the numbers and stuff that you posted about the loan are pretty useless, and have little to do with the deal.
First the property is listed with a Realtor, and the seller could very likely be obligating himself to a commission by selling the property to you during the term of the listing. This is his problem not yours.
Next you indicate that you two are agreeing by e-mail which is O.k. but I doubt that it is enforcable. You need a written contract on paper with real signatures.
It sounds to me very much like both the buyer and the seller are broke as church mice, is this the case? Some points that will need to be addresses when assuming this FHA loan are; are the payments up to date? If not they will have to be brought current. The seller wants a fee of $565 this is probably for the FHA loan assumption package and fee. This is usually in the vicinity of 1% of the original loan. Mostly it is used to check the credit of the buyer. If you the new buyer do not qualify, then the loan assumption will not be allowed, and the fee will not be refunded.
It sounds like you do not have the $565, if this is the case you probably need to wait or get some help on this deal.
There are a lot of other ways to control this property. One would be with an option, or a lease and option. Where you take control of the property and have the right to buy it later on (after you find a buyer).
Another would be to purchase “subject to” the existing loan, giving the seller a mortgage for his equity.
Another would be to purchase on a land contract from the seller. Be careful that he is not in financial trouble here, you need to know if there are other leins or judgements against the property or the person. Is he about to go bankrupt or get divorced?
There is probably a workable deal here but I really do not have sufficient info to be sure.