I hope you’re still hanging in there, getting your list of numbers and calling home sellers. If you are, you have probably found one or two by now and said to yourself, “Self, now what?â€.
Now you go to their home, meet them, look around and determine if this is the home you want.
During your inspection, don’t be afraid to ask questions. How old is the roof? The appliances? When was the last time they had a plumber out? How long ago was the deck treated? Look at the paint, in and out. Everyone spruces up a home to sell it but is new paint covering something up that they are trying to hide?
Filed under Uncategorized by on Apr 5th, 2006. Comment. 
So, you found a motivated home seller and reached an agreement. Now what?
Well, now you need to get the paperwork done and close. This is what you have really been afraid of all along, isn't it?
We will get into the actual step-by-step completion of the paperwork later but for now we'll just take a look at an overview of the process.
As I said before, you will buy the home right there at the kitchen table (kitchen table closing). The seller actually signs the Deed over to you on the spot. This means there are no closing costs and no attorney fees! That is why you can agree to pay all closing costs - there really aren't any.
Almost all loans you will run into will have a Due On Sale clause. This means that if the house is sold, the bank can accelerate the mortgage and force the total amount to be due. However, in actual practice, the bank just wants the payments (although you are not officially taking over the payments by assuming the loan). As a general rule, as long as they are receiving the payments, the bank is happy.
Filed under Uncategorized by on Apr 12th, 2006. Comment.
A short post. As discussed, most home mortgages have a "Due on Sale" clause which permits the lender to call the loan due if ownership of the home is transferred to another party.
Do not set up a fictitious deal to mislead the bank about what you are doing. Do not do this! Do not even think about misrepresenting what you are doing to the lender. This is fraud and can result in severe criminal penalties. Ever hear of Martha Stewart or Enron?
Some advisors will have you jumping through hoops to set up a title holding trust to get around the Due on Sale clause. In my experience this isn't really necessary. I have never heard of a loan actually being called due because of a "Subject To" financing deal. It could happen, I just have never heard of it. The banks want their money and litigation simply costs them money. They do not like that.
When dealing with the bank be honest. Tell them that you will be making the payments in the future. They will more than likely change their records and be happy to take your money!
Filed under Uncategorized by on Apr 13th, 2006. 1 Comment.
For the past couple of posts, I've been talking about buying your home subject to the current owners' financing. There is no end to the articles and information on this subject that you can find on the internet or in your local book store.
What is usually missing though are the forms needed to actually do the transaction. This has always bothered me. If you pay for a course on how to buy your home with no qualifying, no credit and none of your own cash, why are you not provided with the forms you need? I mean, gee, you paid for the course or ebook expecting it to be complete! Well, one course is complete, and it's one of the least expensive.
Filed under Uncategorized by on Apr 17th, 2006. Comment.