I sold a boat slip (NC) 2.5 years ago and financed it for 3 years with a large balloon. The slip has lost half of its value since selling it. The promissory note with deed of trust has $115,000 owed and 6 months of payments left. The buyer says he can't make payments do to recent stock losses. He would like some help but I'm inexperienced with these matters and not sure if changing things would jeopardize anything for me. Any suggestions would be greatly appreciated. He has some assets and a very good credit rating. Thanks in advance.

Well what do you want to do, you can repo that and reale it at a lower price ? You can get him to refi at what ever level he can refi at and accept that as payment in full.

I guess the question is what do you want to do.

Did you sell with owner finaincing or as a contract for deed?

Your options will differ depending on which you did.

If you took back a mortgage, then you can either refi or foreclose and then resell.

If you sokld on a contract, you can extebnd the contract with new terms or void it and recover the property.

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Originally Posted by Fr_Chuck

Well what do you want to do, you can repo that and reale it at a lower price ? you can get him to refi at what ever level he can refi at and accept that as payment in full.

I guess the question is what do you want to do.

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I prefer to receive the full amount that was agreed on. If he has assets, do I have to settle for less? Can he be sued for breach of contract?

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Originally Posted by ScottGem

Did you sell with owner finaincing or as a contract for deed?

Your options will differ depending on which you did.

If you took back a mortgage, then you can either refi or foreclose and then resell.

If you sokld on a contract, you can extebnd the contract with new terms or void it and recover the property.

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The property was put into he and his wife's name. I have completely paid the fed and state taxes on the sale two years ago. There is a promissory note secured by a deed of trust. Promissory note was for three years and balloon based on a 30 year loan amortization
Thanks for your thoughts.

Well if he does not pay when the payment is due, your foreclose on the property, take over ownership and re-sell it to some one else.

So you tell them NO, you will not work out any deal and tell them you expect the payment as promised.

If they can refi part, you can take that money and put the balance they owe you into a second mortgage on the property.

This is why of course I hope you got a very large down paymnet 15 to 20 percent at least. Since owner financed properly foreclose in a lot higher percentages than bank, and we all know what is happening with banks.

Quote:

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Originally Posted by Fr_Chuck

Well if he does not pay when the payment is due, your foreclose on the property, take over ownership and re-sell it to some one else.

So you tell them NO, you will not work out any deal and tell them you expect the payment as promised.

If they can refi part, you can take that money and put the balance they owe you into a second mortage on the property.

This is why of course I hope you got a very large down paymnet 15 to 20 percent at least. since owner financed properly foreclose in alot higher percentages than bank, and we all know what is happening with banks.

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Thanks for your reply. I only got about 7% down and I gave him a great rate, too. Another thought, would my new tax basis be: latest sale price + new expenses= new basis

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Originally Posted by Dana54

Thanks for your reply. I only got about 7% down and I gave him a great rate, too. Another thought, would my new tax basis be: latest sale price + new expenses= new basis

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If I wanted to help him, could I accept $400/ month instead of $800/month for 6 months and then catch up on the balloon? Would a hand written and notorized document be enough to protect me? Thanks again.

You can do anything you want. Just get it in writing as an addendum to the original contract.