Ask Experts Questions for FREE Help !
Ask
    cotugno2262's Avatar
    cotugno2262 Posts: 1, Reputation: 1
    New Member
     
    #1

    Dec 4, 2013, 08:18 PM
    Owners holding mortgage
    I am an owner of a property valued at 200,000. How would it benefit me and how would it benefit a potential buyer if I held the mortgage. The property is paid for,
    ma0641's Avatar
    ma0641 Posts: 15,675, Reputation: 1012
    Uber Member
     
    #2

    Dec 4, 2013, 09:52 PM
    You get the benefit of getting a consistent cash flow and still own the house if they default. Their benefit is little up front cost, little or no closing costs and building equity. You may have to look at your age and term of loan. Make sure will identifies what will happen with house once you pass on./
    ScottGem's Avatar
    ScottGem Posts: 64,966, Reputation: 6056
    Computer Expert and Renaissance Man
     
    #3

    Dec 5, 2013, 05:39 AM
    It depends. Generally an owner will hold the mortgage to make a sale when the buyer has problems qualifying for a mortgage. So the advantage to the owner is making sure the sale goes through. The advantage to the buyer is making the purchase when they may not qualify.

    But the owner may be taking a big risk if the buyer does not qualify for credit on their own. Also a mortgage is a loan secured by the property. With a mortgage ownership of the property is transferred so to regain the property in case of default you would have to go through the foreclosure process.

    A better option is a contract for sale. In a contract for sale, the seller maintains ownership and the contract specifies what happens in case of default.

Not your question? Ask your question View similar questions

 

Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.


Check out some similar questions!

Holding a Mortgage [ 1 Answers ]

Are there age limitations for someone to hold a mortgage? What if homeowner is under 18?

Owners' holding mortgage [ 1 Answers ]

Can I get the 1st time homeowners tax credit if I buy a home and the owner holds the mortgage?

Holding a mortgage [ 6 Answers ]

Hello all, I have a two family in Jersey City and own it free and clear. I would like to if anyone know's the advantages or disadvantages of holding a mortgage. Thank You

Holding a Mortgage for someone. [ 2 Answers ]

We were in the process of putting our house on the market when I ran into a friend (more an aquaintance)... she & her family are looking to get out of their rental and buy something but they cannot go through a bank for a loan due to their religion. They do have a very large amount to give as a...

Holding a mortgage [ 2 Answers ]

What are the advantages and disadvantages of holding a mortgage for a home buyer? The buyer is my daughter and son-in-law. Can they mortgage half the price and I hold the mortgage for the other half? What are the advantages and disadvantages to me? What are the advantages and disadvantages to...


View more questions Search