How To Sell House With Owner Finance?
My wife's cousin wants to buy our house with us carrying the note. We still owe $37,000 roughly but house is appraised around $70,000. Interest rate is @12.75 right now for us. How do I start the process? They want to move in asap... Any advise would be greatly helpful...thanks in advance :-?
Easy, there are several ways to do it, your existing mortgage rate is 12.75% (kind on high interest), so it would be better to pay that loan off if your cousin can pay at least 37000 down. But if your cousin can't put that much down, then you have to carry on your existing loan. Read your mortgage deed of trust to see if any "due on sale" clause. If there is such restriction, then it means your current lender require you to pay the loan in full upon sell of the property. In that case, either you or your cousin have to somehow come out $37000 to pay off the existing mortgage before you can create a new one - with you doing as owner financing and carrying the note.
Ok. Lets get this straight. First of all, pretty much every loan that is out there has a due on sale clause, but people are selling their homes with owner financing every day. I make a living at it. So, to the next step. You say that your house is worth 70k, but you owe 37k. You are in a perfect situation to do a creative finance deal.
Do a lease option with your cousin for 70k.
Make the monthly payments $200 above what you are paying.
Get a 2k or 3k option fee.
Call it a day.
If you need more specifics, post it here.
I hope this helps.
I wouldn't worry about the DOS ther are many ways around that and, you usually don't have an issue there. I know of only a handful of cases where the note holder accellerated the note.
If your really worried then put it in to a land trust and assign beneficial interest to your relative.
[addsig]
I have a question about the land trust if anyone reading this can help. I have been asked to work with a guy named Bill Gatten. He started www.landtrust.net Has anyone used him for this? It seems pretty legit to me but I want more input first. Thanks!