Posted by Bud Branstetter on August 01, 2001 at 12:01:33:
You always want to ask for a discount if you can payoff early. Getting them to agree is the hard part. There is no fraud and the debt is not being forgiven. You have to come up with the cash. As long as the terms are disclosed so that the lender can make their decision on the facts you would not have a problem.
Private 2nd mortgage, legal to discount % of it - Posted by Scott_fl
Posted by Scott_fl on August 01, 2001 at 07:54:05:
If a seller were to take a five year note and mortgage on a property with the option of me paying it off for a discount on two years time. example… Five year note for $22000, interest payments of 170 a month. After 24 payments, made on time, the holder of the note agrees to discount and take payment in full in the amount of $10000, discounting (forgiving) the remaining $12000. Payments have been made, the note will be satisfied over five years or satisfied in two years at a discount of a little over 50%. Now I know it is fraud to create a second mortgage to pose as a downpayment and then wipe the debt clean, a fake mortgage. Is what i am proposing correct? If the discount option is not exercised in two years, the full term of the note will take place. Please give me some feedback guys. Thanks.
Scott