Posted by Gene on February 05, 2007 at 14:21:30:
That would be ideal. I am going to ask my local title company about the short-form or other ideas they have. I have used them a lot and they usually help me out.
Gene
getting the deed - Posted by Gene
Posted by Gene on February 04, 2007 at 18:39:45:
I have a seller that wants to give me the deed to his property and I can take over his existing financing. He wants to walk away without having to pay anything.
He owes about 28k and the value is about 40K.
I talked to the lender (hard money lender) and he said that the loan is fully assumable (with no fee). He also send me a copy of the “deed of trust”. The is “no due on sale” or “prepayment penalty”.
I also went down to the county and the the title is clean…only the hard money loan is recorded against the property and the seller is the recorded as being the sole owner as an unmarried man.
So I am wondering if most of you would just take the deed and take over the existing financing or would use a title company to close, and provide title insurance?
The existing financing is very high intrest (18%) so I was thinking about paying it off asap…but of course there is risk of doing this without title insurance. I am thinking that if I waited a few months with the existing financing in place then I could go down to the county and make sure that I am on record and there are no new liens before paying down the existing loan.
Dose anyone think this is mistake?
Gene
Re: getting the deed - Posted by Natalie-VA
Posted by Natalie-VA on February 05, 2007 at 17:38:12:
Gene,
Just curious to know your exit strategy on this one. No offense, but 12k isn’t the greatest spread.
–Natalie
Re: getting the deed - Posted by IB (NJ)
Posted by IB (NJ) on February 05, 2007 at 11:34:55:
Have you checked out all the loan docs? Prepayment penalty? Other strict requirements for satisfying loan? I would have a lawyer look over the legal aspects of this deal as well as get title ins.
Ib
Re: getting the deed - Posted by Max-va
Posted by Max-va on February 05, 2007 at 08:44:56:
Although a kitchen table closing is legal, why take the risk. Get a title company to close this. Get title insurance on this as well as a warranty deed. Refi out of the high rate mortgage ASAP
Re: getting the deed - Posted by Gene
Posted by Gene on February 05, 2007 at 18:35:51:
Yea, I prefer the bigger deals but its hard to resist when someone wants to give you the deed and you don’t need to come up with any cash and the property is 30% below as-is FMV.
Plan A is to sell the land/home as a fixer thru my realtor.
In my area if this was cleaned up it would sell for about 60k. The least expensive land/home on the MLS in my are in the 60k range right now. I am going to list it for $42k so it should sell real fast.
My market has slowed down a bunch but the cheap stuff still moves fast.
In mid march I am going on vacation for a month. My wife can close it while I am gone.
If it dosn’t sell it will make a great rental. It would easily rent for $550 to $600…so it will cashflow. I have a few rentals in the same area…so I am not opposed to renting it but I just don’t have the time right now.
But I love having multiple exits!
Gene
Re: getting the deed - Posted by Gene
Posted by Gene on February 05, 2007 at 12:45:42:
Yea, I checked out the loan docs really carefully. There is no prepayment penalty, no ballon, no transfer fees…basicly its fully asumable. The terms are very good except one…Its amazingly high intrest.
A frind of mine is a paralegal that works for a developer. She said that I should just get title insurance to protect myself.
Gene
Re: getting the deed - Posted by Robert Campbell
Posted by Robert Campbell on February 05, 2007 at 14:07:11:
Gene,
I believe you can get the “short-form” title insurance policy for less than $100.00. This may be your safest and most cost-effective alternative.
Best wishes,
Robert Campbell