Owner Financing
Can a buyer obtain owner financing (note and mortgage) from a seller who still has an underlying mortgage? For example if the seller owes $70,000 and you agree to buy it with owner financing for $75,000 how would you set the payments up? I dont think the seller would want to take a loss each month on the spread would they? COuld you offer to match their underlying payment until you refi or something like that? Can this be done on a non free and clear property?
Sounds like you want to look at a sub2 deal. Assuming the mortgage of the seller. There's another forum that's all about this type of REI.
Roger
Yes I am aware of sub2 but just wondering if this would work for sellers who do not want to do sub2.
Cheapest way for you to do this would be a sub2 deal. You take over the existing mortgage while the seller holds a small 2nd for the difference (hopefully you can negotiate the rate down).
If that doesn't work, then just have the seller hold the new mortgage for you - encompassing the existing mortgage which he will have to take care of - and negotiate the lowest interest rate you can. Good luck
I he holds a mortgage for me, wont I have to pay him at lease what his payment is? How would interest come into play?
What you are looking for is a variation of one of the following:
Contract-for-Deed
Wrap-around mortgage
Land-Contract
All of these can be used when an owner has an existing mortgage