credit report personal statements
credit report personal statements
Selling property. Buyer wants me to act as lender. Should I?
The buyer is putting down a 20% deposit. Large amount actually. It’s a 10 year loan. I wish he would go to a bank, but my partner thinks this is a safe deal for us. My partner thinks if the buyer doesn’t make his payments then we can just foreclose on the property and keep the big deposit. He thinks it is incentive for the guy to make payments. What docs should I ask for if I do this? (personal financial statement?, credit report?) Any advice is appreciated.
There are risk in everything you do in life. There is a system in place that take care of potential problems if your buyer fail to make the monthly mortgage each month as agreed.
Many individuals do this type financing it is called seller carry back, though there might be other names in different parts of the country.
You might get a credit report, proof that he has a job, bank account balances etc. You will need a statement signed by him or others that will be on the mortgage authorizing you to get this information. You might make copies of this signed authorization and use it more than once.
Draw up a contract stating the interest rate, number of years you plan to carry this mortgage note. You will need to have in this contract the amount or percentage that the buyer is putting down on the property. Once this contract has been drawn up and signed by all parties concerned, take this contract to an escrow closing agent in your state. In some states attorneys are used as escrow closing agents.
This escrow closing agent will draw up the “Escrow Instructions based on the contract you present. If there is additional information this escrow closing agent will request it. You or the escrow closing agent will have to use a title company so the title can be passed to the new buyer. Most of the time the escrow agent will know a title company that they work with. It is ok if they select this company.
Most of the work that need to be done will be done by professionals such as escrow closing officers, title officers and others that you might introduced to in this real estate transaction.
You will need someone to draw up the loan docs for your buyer to sign. Google “Magic Docs” This company specialize in preparing professional loan docs. Once you have made contact with this company you will need to supply them with the information about the length of the mortgage loan, the interest rate you are charging. There might be other questions asked of you, but they are not difficult.
For the cost of the docs you might add this to the closing cost of the buyer. You will need to have a notary public notarize these documents, another fee charged to the buyer.
If the buyer fail to make the monthly payments you need to google foreclosure services, several companies will pop up. They are professionals that are in business to take care of foreclosures in your state on behalf of those that need their services. Use a professional service if foreclosure becomes necessary.If you make one little mistake in the foreclosure procedure, you have to start over from the very beginning. Most of the foreclosure companies will not charge you an up front fee, but take their fees out if the property goes to sale.
Failure of the property going to sale or a sale returns the property to you, at this point you will be required to pay the company that conducted your foreclosure on your behalf.
Please don’t take this foreclosure problem to an attorney as they will charge you for their consulting and will refer you to a company that does foreclosures in your state.
Once you hire this company they have attorneys on their staff that will be able to answer any legal question concerning the foreclosure to include any possible bankruptcy.
I hope this has been of some benefit to you, good luck.
“FIGHT ON”
