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    Owner financing

    So, the whole reason I even joined this forum was because I was looking into bankruptcy. Why? because we built a new home, our old home hasn't sold, and when you combine that with medical bills, and credit card debt, we are drowning.
    Our former home is still on the market, and we are very aggressive about selling it, and basically breaking even just to get rid of it. I'm looking for advice and opinions, thoughts on owner financing. We were approached by our real estate agent that 2 different people have inquired about it within the last few days.

    #2
    Are you asking whether you should carry a 2nd or even the primary mortgage for a property that you want to sell? I'm assuming that you own it free and clear? Owner financing can be a blessing and a curse. In my case, I did a lease-to-own with owner financing. The lease-to-own is nice in that you get a large downpayment and the new people will keep the place nice. They get to treat it as their own property. Then, after 1 or 2 years, they convert to a regular mortgage when their finances and credit are good.

    If I'm on the verge of bankruptcy, I wouldn't consider owner financing. The odds of the people defaulting is high. If you do provide owner financing or carrying back a 2nd, make sure they have a decent deposit (> 10% and probably closer to 20%).

    Just my thorughts.
    Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
    Status: (Auto) Discharged and Closed! 5/10
    Visit My BKForum Blog: justbroke's Blog


    I am not an attorney. Any advice provided is not legal advice.

    Comment


      #3
      No, it's not owned free and clear. But has a 2nd mortgage, so virtually has no equity. Our goal is to sell it and never have to think about or stress about the note again.
      1st mortgage note is $484 monthly, 2nd mortgage is $295. So even with both, its relatively cheap. However, we built a new home, and that note is $1750 and that's the one I want.
      My goal is to get my $800 in my pocket or applied toward other bills. I basically want out of the note. Don't really care how. Currently we have literally less than $50 a month for emergencies and extra spending.
      Having that $800 would solve almost all of my problems.
      Thanks for the explanation and advice. Yes, having the lump sum would be GREAT, IF they keep the place nice. It's been for sale since July 2018 and we have had bites, just no serious or qualified buyers.

      Comment


        #4
        So, are you looking at a lease-to-own or some other lease/purchase option? Your property is encumbered by a first and second mortgage, so you may need to speak with a real estate attorney to ask about your options. I had a property that had those types of nibbles as well. On that one I also offered a lease option but most people couldn't come up with the option fee. They just wanted to get the property as cheap as possible. So frustrating.

        Oh, are you doing a for sale by owner (FSBO)? That can cause the sale cycle to quadruple or worse. My neighbor has been trying to sell his home FSBO for the last 6 months, while others in the neighborhood were under contract for their homes in 15 days or less (in the same period).

        I wish you the best.
        Chapter 7 (No Asset/Non-Consumer) Filed (Pro Se) 7/08 (converted from Chapter 13 - 2/10)
        Status: (Auto) Discharged and Closed! 5/10
        Visit My BKForum Blog: justbroke's Blog


        I am not an attorney. Any advice provided is not legal advice.

        Comment


          #5
          Thank you. Yes, we are definitely using a realtor. I have no time to deal with indecisive people, or all the papers that go along with real estate sales. The sale price will only clear us around $2000. We are super motivated. Hopefully it will work out soon.

          Comment

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