Owner Financing
I have several questions on the pitfalls of owner financing. I'm in FL which have homestead exemptions and other related protective laws. Is there a way in the contract to roll the deed back to me if payments aren't made. I believe this would work up to the point they got homesteaded but then what protects me?
I looked thru several forms and couldn't find one on "owner financing"
Thanks for a good site.
Kirk
I would use a land sales contract ( generally the deed stays in your name and in escrow until the terms have been met) then ask for one of several things. IF I foreclosed "strict foreclosure" IF legal in your state a "Cognovit" note. Also putting the property into escrow with clear and firm intructions as to the parties responsibilities and getting a "quit claim" signed by the buyer should he falll behind three months would be some options. Others might be putting it into trust with yourself as the trustee and having an assignment of beneficial interest placed with the trustee should the buyer fail to follow through etc.
Get the help of a local attorney that specialiizes in RE.
[addsig]
Thanks, I like the trust idea. That would allow the buyer to be homesteaded and rights as an owner but having the benificial interest rolled back to me for non payment covers me. I think I run this by my attorney and get his 2 cents. My attorney isn't a fan of trusts but in this case it may be the only way to protect me. I'm worried I fincamce someone and 2 years from now they file BK. I can't foreclose until the BK is over. I have seen it take over a year just for the BK.
Thats a long time to be covering a mortgage!
The trust idea is one of the best ways to go. One thing that could help you is to clearly note in the land contract that in case of defult all payments through the time of defult would be considered as a rent payment.
Once you create a paper suitable for your situation you always can consider selling all or part of such a paper, thus getting all or just some of your money out of the property.
Hope this helps,
Alexander