Posted by Barbara(AZ) on May 25, 2000 at 11:39:55:
Nicole, I bought a house on a wrap and was added on the
seller’s insurance policy. Might work for you too.
Wraps, what do I need to remember when I am the seller? - Posted by Nicole (AZ)
Posted by Nicole (AZ) on May 25, 2000 at 11:25:40:
I know the jist of how a wrap works. What I want to know is what mistakes I need to avoid if I am the seller of the property and want to sell on a wrap.
Here are some questions.
My current mortgage payments include PITI. Should the amount that I accept from the buyer on a monthly basis include PITI?
Does the new buyer have to carry a separate insurance policy on the house as they aren’t listed on my policy?
What are some other things that I absolutely need to not forget?
Thanks for the help.
Nicole
Things to remember… - Posted by SusanL.–Bradenton, FL
Posted by SusanL.–Bradenton, FL on May 26, 2000 at 08:13:06:
You can also include your buyer?s property taxes in with the PITI (if you want to collect them yourself). If, on the other hand, HE pays the taxes himself each year, then follow-up to make sure that they ARE, indeed, paid! You sure don?t want any surprises cause it COULD have a ripple effect if you have a D.O.S. clause!
The same goes for the homeowner?s insurance policy. Also, make sure you are shown in ?first position? on his homeowners policy.
This may be obvious but—Have a late fee written into your contract (5 days or whatever). Same goes for ?foreclosure? information (specific number of days). You’d be surprised at what people forget to include.
(I had someone hold a ?second? on my commercial property and HE forgot to write in a late fee in the paperwork. Of course, that was to MY advantage, although I never abused it.)
I also had my lawyer state the specific loan numbers that the loan was being wrapped around. At first he had neglected to include this information in the paperwork (which I thought odd) so I had him add it before I signed anything. I wanted EVERYTHING spelled out.
If you have a ?balloon? date, make sure to spell out exactly WHEN you want it paid (not just say in three years or in five years). That way there is NO room for error.
Good luck!
You can also include your buyer?s property taxes in with the PITI. If, on the other hand, he pays the taxes himself each year, then follow-up to make sure that they are, indeed, paid! You sure don?t want any surprises!
The same goes for the homeowner?s insurance policy. Make sure you are shown in ?first position? on his homeowners policy.
This may be obvious but—Have a late fee written into your contract (5 days or whatever). Same goes for ?foreclosure? information (specific number of days).
(I had someone hold a ?second? on my commercial property and HE forgot to write in a late fee in the paperwork. Of course, that was to MY advantage, although I never abused it.)
I also had my lawyer state the specific loan numbers that the loan was being wrapped around. At first he had neglected to include this information in the paperwork (which I thought odd) so I had him add it before I signed anything. I wanted EVERYTHING spelled out.
If you have a ?balloon? date, make sure to spell out exactly WHEN you want it paid (not just say in three years or in five years). That way there is NO room for error.
Good luck!
Re: Wraps, what do I need to remember when I am the seller? - Posted by Bob(AL)
Posted by Bob(AL) on May 25, 2000 at 15:44:55:
I always collect PITI. Also, leave the insurance in your name. The buyer should get liability insurance.
The only other suggestion-Try to get a balloon.
Bob(AL)
Re: Wraps, what do I need to remember when I am the seller? - Posted by Bob (AL)
Posted by Bob (AL) on May 25, 2000 at 15:42:05:
Barbara:
I always collect PITI from the buyer, as part of the monthly payment. You need to leave the insurance in your name. The buyer should get liability insurance for himself.
The only other suggestion-I would put a balloon in the contract.
Bob(AL)