Post

How long does it take to close with owner financing when the owner has a mortgage?

Question by Dilbert: How long does it take to close with owner financing when the owner has a mortgage?
In other words, what time-consuming activities have to happen before closing, when the owner providing the financing is already satisfied of the property’s value and condition, so there is no need for additional inspection, appraisal, etc.?

I assume the key issues are paying off the owner’s mortgage, recording the owner-financed mortgage, and getting the title transferred to the new owner. But do those get done before or after closing?
The owner’s liquid assets plus the seller’s down payment will add up to enough to pay off ther owner’s mortgage.

Best answer:

Answer by goz1111
Nothing is Kosher until the first loan is paid off, until that happens the existing loan has priority interest over the property

How is the seller paying off the first?

Know better? Leave your own answer in the comments!

 
2 Comments for this entry
kemperk
June 18, 2011
17:06

since that is called a “wrap,” the closing should take 1 day; since
there is no outside financing involved.

your seller has to make sure he is not causing an ACCELLERATION
of the loan.

Meaning, sometimes, it is a document that looks like a lease
purchase–the words of the agreement have to be perfect to
not permit the lender to call the loan due.

ask about that.

then, be ready to close the next day.

or, ………the seller is doing something different entirely!

or the seller is paying off the mortgage! This year, I have not heard of
any seller having any equity left after doing so!!!!

Reply
David Z
June 18, 2011
17:28

if you want title insurance (and you do) that could take a couple of weeks. other than that this could be done in a few days.

just schedule a closing with title company.

Reply

Leave a Reply

Your email address will not be published. Required fields are marked *


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>