Flipper/Rehabber · Dallas TX (dallas, tx) · Member since 2020 · 11 posts · 1 vote
I'm new to doing owner financing deals. I'm having a hard time figuring out what contracts to use when buying with a wrap around mortgage. Besides the purchase and sale agreement what other contracts would I need?
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
6y
Hey @Luis Alvarez if you are buying and the owner has a mortgage, yes, you can do a wrap around mortgage. When you sell that same house, you probably want to have the buyer get a new loan. Otherwise, you would have a wrap of a wrap. Technically possible, but not recommended. It is just easier to cash out of the deal and get everyone's name off the mortgages.
As far as contracts, use the TREC contract. There is a space for special provisions. Spell it out. Use the addendums for owner financing.
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
6y
Hey @Luis Alvarez if you are buying and the owner has a mortgage, yes, you can do a wrap around mortgage. When you sell that same house, you probably want to have the buyer get a new loan. Otherwise, you would have a wrap of a wrap. Technically possible, but not recommended. It is just easier to cash out of the deal and get everyone's name off the mortgages.
As far as contracts, use the TREC contract. There is a space for special provisions. Spell it out. Use the addendums for owner financing.
Rental Property Investor · San Antonio, TX · Member since 2020 · 21 posts · 9 votes
3y
Hi guys, I realize this thread is old but it is exactly the kind of conversation I was looking for. Owner financing in TX, specifically San Antonio!
On the other hand if I buy an wrap or other type of owner financed property, how am I protected from a potential foreclosure on the seller? My questions is, let's say something bad happen on the sellers life say divorce, accident, bankruptcy anything like that and while I keep posting my monthly payments to the seller the payments from the seller to the lender stop.
Do I have any recourse at that point if the lender decides to foreclose the property due to seller's default?
Wholesaler, Rehabber and Landlord · San Antonio, TX · Member since 2014 · 2k+ posts · 2k+ votes
3y
If I am the buyer on the wrap, I would want to make the wrap part the same terms as my loan to the seller. If there is more that I owe to the seller, create a 2nd or actually it would be a third to the seller. I would pay the sellers mortgage since it is the same amount as my 1st. The seller is getting his money from my 2nd or third on the property.
Newbie here but I own an owner financed land. Question: 1. Can you sell an owner financed property? 2. what are the implications/precautions - pros/cons?