FHA loan paragraph for "Due on Sale"?? - Posted by Mel

Real Estate Investing Real Estate Financing
#1

Posted by JT - IN on June 18, 2001 at 23:07:02:

I understand the Sellers hesitance of signing over the deed to a property. A Seller must be in serious hot water, or a serious don’t wanter, to entertain a subject-to. When you cannot over come their objections to a subjet-to, then a CFD would be next, with a L/O being the next alternative.

As for me, I usually purchase with all cash, realizing a deep discount, and sell with terms, attaining the highest possible price for resale. Absent that luxury, work the system to attain your best deal, and know when to say when; or enough; and when to move on if the Seller wont play by your rules.

Now wasn’t your question about due on sale clause ? Have you taken out a copy of a mortage and spotted para # 17 ? It should be there.

JT - IN

#2

FHA loan paragraph for “Due on Sale”?? - Posted by Mel

Posted by Mel on June 17, 2001 at 11:27:46:

I would like to know what Paragragh in an FHA Loan describes the “Due On Sale” information. I currently have a seller with a FHA loan about 12 years old. He put “Bond Money” for the down payment. Not sure what “Bond Money” for down payment is either?? He says the loan is assumable but I am not familiar with the FHA load structure. I would like to tell him to look at paragraph ??? or page ?? and read to see if there is a “Due on Sale” clause.

Thanks in Advance…

#3

Para. 17 - Posted by JT - IN

Posted by JT - IN on June 17, 2001 at 17:25:56:

Para 17 in a standard Fannie Mae mtg agreeement, contains the Due on Sale Clause. Judging by the age of this FHA loan, it could preceed this clause.

FHA loans stopped being assumable, without the buyer having to qualify, in 1988. Your Seller is close to that time frame, so it may or may not be one of the older mtg, without a due on sale clause.

However, there is no need to assume the loan regardless, just purchase the property “subject-to” the existing mtg, and forget the assumption process. It will work, and all will be blissful.

JT - IN

#4

“Due on Sale”?? - Posted by Kiersten

Posted by Kiersten on June 17, 2001 at 17:15:12:

All FHA loans have a due on sale clause.

#5

Re: Para. 17 - Posted by Mel

Posted by Mel on June 18, 2001 at 09:49:04:

I understand the “subject to” but my seller’s are resistent to giving over the deed. Do you experience this are do you use “Contract for Deed”??