I currently owe 167K, and the house was appraised for 210K in july. My friend is willing to lend me 15K, can I use my house as collateral? or put a lien on it for that amount to ensure him the money incase of anything? If so... how would i go about doing it?
2007-01-06 10:08:20 · 3 answers · asked by Stephenie 1 in Business & Finance ➔ Renting & Real Estate
You can give your friend a second mortgage on your home. By law if your friend is not a licensed lender they can only charge up to 12 percent interest. A local closing attorney in your area can draw up the simple mortgage for you for a couple hundred dollars. You must speak with your friends and work out the terms of the mortgage that will be agreeable to both of you first. Ex: Amount, interest rate, number of payments, first payment date, penalties if you pay late, how long before a penalty, how many years or months etc.
good luck in your adventure.
Michael
2007-01-06 10:18:41 · answer #1 · answered by Bestbank Real Estate 3 · 1⤊ 0⤋
Yes, you can use your house as collateral, however, I would talk to a lawyer. If you can't afford legal fees, contact your local city government and ask them if they offer free or discounted legal services. If they don't, ask them to refer someone that does.
Good luck!
2007-01-06 18:16:09 · answer #2 · answered by suede_blueyes 3 · 0⤊ 0⤋
If your friend is lending YOU money, she/he has to use their own possession(s) as collateral. Anything you put a lien on will be repossessed if the person defaults on the loan, so it must be something they possess themselves. Your friend needs to go to a bank and apply for a personal loan in order to give you the money...if her/his car is paid off, that could be the collateral...otherwise, any other substancial possession could be used.
2007-01-06 18:17:53 · answer #3 · answered by gimj314 2 · 0⤊ 3⤋