$8,000.00 Tax Credit
I have a tenant who would like to buy my house using the new $8,000.00 tax credit. I have a $60,000.00 home equity loan against the house. They want me to finance the sale. What would be the best way to structure the deal?
Scott
There are a 101 ways to do this.
If you would provide some more specifics, we can give you better feedback.
The house is a rental worth about $70,000.00. The tenant would like to use the Obama first time home buyers tax credit as their down-payment. They would like me to finance it. I owe $56,000.00 on a home equity line of credit against the house @ 2%.
My questions are these. Can I sell them the house and leave the LOC in place or would that have to be paid off? Also how does the tax credit work? Can an owner finance deal where title does not pass until payoff still qualify for the tax credit?
Scott
Few more questions on your points, Kid...
1. The interest just gets assigned over at tax time or how is that handled, computed for seller and buyer since loans stay in place w/owner financing?
2. If default, foreclosure process? Is it difficult ?
3. Advantages/Disadvantages of Rental/Owner Fin. ?
like the refund anticipation loan, is there a tax credit anticipation loan, that you could get the $$$ up front.
as far as foreclosure, read about contract for deed or land contract in you state.
If you would provide some more specifics, we can give you better feedback.
Investors beware!
If you are creating the land contract and youdecide to sell the note to a Note buyer be sure the note is sellable! As a Note Buyer I have found that we cannot fund many transactions because the investor did not prepare a sellable note.
Although you may not be interested in selling your note today, one cannot predict the future.
During this period of economic uncertainty our investment strategies change daily. In other words as an insurance policy contact a Note buyer/broker and get some advise on creating a sellable note. Note investors just like banks are changing their yields and parameters.
thanks
L. Young131
Well there are many programs available. We will refinance a lease option contract as long as it is recorded. but why do you want to use a lease option?
I have found that it is better in Ohio to use a wrap around mortgage or land contract. 1. If the borrower is a first time home buyer you get the 8000 tax credit. now any one can get 6500. 2. suppose the buyer(s) credit is not high enough for bank financing? You can sell the note or recieve a partial on the note.
3. if the buyer did not put a minimium of 20% down or had the land contract for 5 years in case of non payment the note holder can file a fortieture. similar to an eviction.
check your state laws for the statues...
L. Young131[ Edited by LYoung131 on Date 11/22/2009 ]