Owner Financing Advice Needed

[Dan Biga]

I have a 2/2 condo in Gulf Shores, AL that I owe right at 250K...the condo is probably currently worth 115K...I have a potential buyer that is interested in me "owner financing" the deal, and she basically take over my payments...yes, she is aware that she will be paying more per month than what she could typically conventionally "buy" for, but she is recently divorced with some credit issues...my question is: how do I structure this deal, knowing that it might take 15 years for the original balance of my loan to come down to meet the appraisal so that she could then qualify for her own conventional loan?

Any advice/suggestions are welcome!!!

[Jon Holdman]

Sounds like a situation for a wrap or "All Inclusive Trust Deed". You create a new mortgage that wraps the old one. You collect payments and in turn make them to the existing mortgage. Find a knowledgable lawyer and title company to get this all set up property.

I think you should plan on this deal defaulting. If she does intend to clean up her credit, it won't take her 15 years to do it. At some point she will realize she's on the hook for a insane amount of money vs. the value of the property and will stop paying you and buy something else.