Dear @David M Trapani, this is an amazing advice, if only i can give 10 up votes! It is very detailed,insightful and well crafted advice! I am truly appreciative of your time and advice.
Originally posted by @David M Trapani:
Some lenders use a loan servicing agent (LSA) and some do not. If lender and borrower both have CPA’s the 1099 and accounting are handled without an LSA.
While an LSA can play the role of collecting / remitting payments, accounting and enforcement in the event of default (foreclosure), its not necessary to have an LSA and may add extra layers of complication or expense.
I’ve found that if you have a reliable escrow agent: they will handle the crafting of the note and mortgage, arrange for necessary signing / notarizing / recording of the documents & handle distribution of loan funds.
Depending on which state you’re in, the lender himself can be both the Beneficiary on the note and the names foreclosure Trustee under the mortgage. In the event of default, typically a professional foreclosure trustee company is substituted in to process the foreclosure for the lender.
Alternately, depending on your state a title company or reputable foreclosure trustee can be named in the mortgage as foreclosure trustee, who would only “Spring” into action in the event of default.
Payments under the note can be structured by check or auto-pay, depending on the parties needs.
Attaching amortization schedule is a good idea for amortized loans. If interest only it’s not necessary as the note should reflect the needed details on its face.
The CPA’s handle accounting and the rest of of those matters.
Hope this helps. Best wishes,
