Seller Financing Myth Buster: How to Sell a Property by Wrapping the Existing Mortgage
I have been spending a lot of time reading blogs about owner financing of real estate transactions, and there seems to be myth out there that you can not do owner financing if the property is not free and clear. I
Jay,
I did a wrap a couple of years ago on a countrywide mortgage with no due on sale clause. As you said they were more than happy to have someone take over a mortgage and make payments on time. You state that it’s a myth that one can’t do a wrap if there’s a due on sale clause. For me the hurdle is that the title company won’t do a wrap if there’s a due on sale clause. How does a buyer get around that clause with the title company?
Mike Mitchell
Mike,
Wow! I hadn’t heard of that. Let me talk to some folks on Monday to see if they have heard about a title company not closing for that reason.
What type of instrument are you using? Contract for Deed? Deed of Trust?
And, if you don’t mind, which title company? Is it one of the national chains?
jay
Mike,
I have checked around with a couple of people and no one seems to understand why a title company would not close on a wrapped contract.
A friend of a friend is a big time real estate attorney in Texas. He said that if the title company won’t close on a wrap, find another title company.
jay