Which is better as a property owner -- should I sell my home contract for deed, or rent it? I am upside down on my mortgage right now and can't afford to sell my house conventionally (I don't have the cash to pay the bank the difference between what I owe them and what the house would sell for). Should I rent it until I'm not upside down on the loan, or do sell it via contract for deed? What are the pros and cons of each? Thanks!
2006-08-06 09:33:34 · 4 answers · asked by BreadCollision 1 in Business & Finance ➔ Renting & Real Estate
As long as you don't mind being a landlord and get good tenants, renting has the best return for you.
2006-08-06 09:42:04 · answer #1 · answered by Anonymous · 0⤊ 0⤋
I would do neither until I've talked to my lender to see if they would accept what's called a short-sale. If you're currently behind on your payments and the value of the house has dropped then your lender will be more open to accepting a short-sale. A short-sale is the term of accept less than what's owe on the mortgage without you having to bring a check to the table at closing.
If you're current on your mortgage, and if you really feel the house value isn't there, would someone really buy it for that amoutn even if you're offering it for sale by land contract?
If you do decide to sell it by land contract, try to get as much cash as possible upfront or some type or collateral in case the person defaults.
2006-08-06 12:35:08 · answer #2 · answered by El_Nimo 3 · 0⤊ 0⤋
have a title atty (local title company )give you a contract for deed its a simple form but you want one that is seller specific (in your favor)that u keep tax write off , buyer must have a loan to buy in X amount of time, get max u can for down i.e 5 % -10 % down pay is not refundable where as deposit suggests it is- that way they have pride in ownership but you get your $ & they dont trash the place. my experience BE SURE they water the foundation and have them pay you each month & make them have renters ins. to cover contents when your policy goes from h/o's to fire policy thats just structure. and dont let them make changes to property until they buy w/ teir own loan i.e "buyer to have loan in 24 months or X # of months. have documentation of everything.and if you really want to sell it have a loan guy TRY to get them a loan now ao they can tell the buyer what to do in prep for loan down the road & then youll be in the loop and know the lender requirements etc.good luck!!
set up properly its painless if not you could b asking for a nightmare come true!!
2006-08-06 10:23:03 · answer #3 · answered by Anonymous · 0⤊ 0⤋
rent is income every month
where as selling is not
2006-08-06 12:40:45 · answer #4 · answered by JULIE 7 · 0⤊ 0⤋