Doing a wrap on a vacant parcel with owner carry

[Page Huyette]

I own a vacant parcel in a desirable part of town that we purchased as part of a package agreement with a seller (buy this one with the other and we'll give you a deal).  There were a few complications with boundaries and septic they didn't feel like dealing with.  That's all been resolved and we'd like to sell the vacant lot but have an owner carry with a one-year term.  Other property is a duplex on a lot we'll split down the road a bit.

I'd like to do a wrap mortgage for a buyer, but would need it paid off at the one year mark per our mortgage terms, though I suspect we could extend the timing on our mortgage with the sellers a few months if needed.  My thoughts were to amortize over 15 or 30 years with at least 10% down.  Curious how to structure this so it doesn't get us in trouble with Dodd-Frank.  

Don't think a lease-option or similar structure would work since this will likely be purchased to build a single family home, and assume the bank lending on the construction loan will need to see ownership of the lot.

[Mitch Stephen]

Get permission from your lender to do the Wrap- Around Mortgage. 

If the property is going to be a homestead or otherwise the buyer's home, hire an residential Mortgage Loan Originator (RMLO) to keep you compliant with Dod-Frank etc.

you're wrap-around mortgage should explain to your buyer's everything about your underlying debt.

Find a private lender to replace the current lender...get more favorable terms than the 1 yr balloon. the key to almost every investment strategy is private money with favorable terms. Perhaps this is a great place to start cultivating your private lender pool.

--Mitch Stephen--