Trust and avoiding prepayment penalty
Hello-
I have a mortgage that has a prepayment penalty(5K) and prohibits sale to "related parties". To avoid a penalty, I was thinking of "buying" the property myself via my land trust and presenting closing documents with land trust name on them as proof of sale to unrelated party.
Would this work?
thanks in advance for your help
PREZ69:
Take alook at the article I wrote :
http://www.thecreativeinvestor.com/modules.php?name=News&file=article&sid=70
In it I wrote on how you can create a sales transaction held inside of a Land Trust with Equity Holding features that allow you to resell your interest ownership without Violating the Due on Sale Clause of the mortgage loan you leave in place.
But help me to understand-WHY DO YOU WANT TO SHOW the BANK Anything about what you plan?
It think you are intending to repay the mortgage, get relief from the loan payments by having someone else (a New Buyer) to pay on the mortgage and other expenses of the home
WHILE AVOIDING the DUE on SALE $5K PrePATYMENT PENALTY!
If this is K-Rekt! Then go to my article (Link above) and read how to do this both Quickly & Safely!
Hope this Helps!
DERRICK ALI
[addsig]
I am trying to refinance property at a lower rate. However i have prepayment penalty that is levied if I prepay the loan or sell to related party. To avoid penalty I have to present documentation from closing which lists the buyer of the property. Therefore I was thinking of having a buyer listed as a trust to avoid "related" party penalty.
Reading the document that you listed, I have a question on it as well. The concept makes sense, but I am unsure of few things:
100% of the tax write-off applies only if it's your 1st or 2nd home? So if you are buying/selling properties it would not apply?
How would this work if there are multiple liens/mortgages on property?
If current loan is at a high rate, would it not make sense to refinance?
Typically, in what position is seller; that he would accept such proposal? What would be a sample offer from me?
thanks a lot