CFD To Buy My First House?
Hi All,
I've recently have been talking to friends of my brother about buying their house. I don't think they would give me their deed subto, but I explained the benefits of CFD she likes the idea of not having to maintain the house anymore(because of a bad experience with a tenant) My question to you guys. What are some of the steps I should take before signing a CFD. Should I record a memorandom of agreement like you would on a l/o. Any suggestions would help. Thanks
hello anyone????
Most on this site that use CFD use them to sell property, not to buy.
I've read that it's not a wise thing to do. The seller still has control of the property and could get a second loan without your approval. If the seller is motivated, then she needs to do things your way.
I'm all for buying on C/D's. The key buying points for me are:
1) limit the total number of loans in my name
2) limit my initial out of pocket expense - many times I'll offer 2% down, and get that back almost immediately with the security deposit.
3) when it's time to get a new loan, my seasoning time is from the date of purchase, unlike a lease option. - therefore i normally use 15 month contracts - i can do a cash out refi in 12 months
4) if the property is in really bad shape, I have leverage to reprice the contract (never had to do this, but if the seller already got all of their money they are less inclined to do anything fro me.
5) very quick closings are possible since there is no "underwriting"
As you can tell, i am very pro on the buying on CD's; you'll need a standard purchase agreement that will completely outline the transaction and a Contract For Deed financing addendum. Call a title company you like or an attorney and you should be able to close within a week.
Was there a 1st mortgage in place?
Yeah there was a first mortgage of 45,000
Congrats -now go get another-!
OTW :-D