I am looking at a house to buy i talked to the agent.He said the owners would (hold a mortgage) with 25-30% down what does that mean
2007-05-30 00:43:57 · 5 answers · asked by madsatanspawn2 1 in Business & Finance ➔ Renting & Real Estate
Means instead of getting a mortgage company involved the owner is doing the financing. YOu pay him. Usually cheaper, faster, less hassle and less restrictive than a standard mortgage; make sure you have an atty review the loan doc's and deed as they will not be the standard mortgage documents in many cases.
2007-05-30 00:45:51 · answer #1 · answered by wizjp 7 · 0⤊ 0⤋
It depends. If the mortgage is in the owners name it means they own the mortgage. However, who ever has the tittle in their name is the real owner. Be careful today there are a lot of interest changing loans that owner may want to hold because the rate will change from month to month even but make you pay the same amount. When you go to the date they release the loan you may find yourself in what is called negative amortization which simply means they will add the difference to the original mortgage that you will then have to pay.
Why would they do this? because if they pay out of the mortgage now they may have a pre payment penalty and it could cost them thousands making the sale of the home a loss.
But if they can find someone to buy it now and agree to pay the balance on the mortgage in a time lot then their home free and you will have purchased an over priced home in today's market.
This is a trend the market is seeing now with all the foreclosures of these loans that were made about two or so years ago.
I can't tell for sure what is going on but be caution and seek the advice of a real estate attorney Before YOU sign any agreement.
Good Luck I hope this helps you.
2007-05-30 07:52:24 · answer #2 · answered by MuseumGirl48 3 · 0⤊ 0⤋
It means you have to have 25 - 30% of the purchase price in cash for a down payment and the owner will finance the rest. If you can get a mortgage through a bank or mortgage company you would probably be better off. You can get mortgages will very little down payment. Even conventional loans only require 20% down. With FHA you only need about 3% down. Plus, the interest might be lower.
2007-05-30 09:20:31 · answer #3 · answered by angela 6 · 0⤊ 0⤋
That means if you put a downpayment in cash of 25-30% of the purchase price, the current owners will act like 'the bank' for financing the remainder of the amount due on the purchase price.
2007-05-30 07:47:11 · answer #4 · answered by acermill 7 · 0⤊ 0⤋
really dont know.ask him,
2007-05-30 07:46:50 · answer #5 · answered by luvuyo s 2 · 0⤊ 0⤋