We need a fast sell that won't ruin his already ruined credit. A friend told me about a sale type in which the buyer assumes payment of the mortgage and the deed, but the sellers name remains on the mortgage so not to ruin, and possibly help his credit. He said it was a new "back-door" in realestate. any idea what this type of sale is called??
2007-06-26 10:58:28 · 7 answers · asked by fire_boy807 2 in Business & Finance ➔ Renting & Real Estate
Yeah, its called a rip off for the seller. The problem with that is that the buyer can assume the deed, and may start paying the mortgage (and the mortgage company will accept the payments) but (as you mentioned) the mortgage stays in the sellers name. Thus, if the buyer stops paying the mortgage sometime in the future it the sellers credit that will still get hurt (since their name is still on the deed). Bank will not allow new sellers to assume mortgages (except in very rare cases to avoid having to forclose on the property) and in fact if they find out that the property has changed hands they will immediately call the loan in full.
2007-06-26 11:04:44 · answer #1 · answered by Slumlord 7 · 0⤊ 0⤋
A scam, his name on the title someone else assumes the mortgage and the deed. Buyer renigs on the mortgage payments, but owns the house yet brother in law owes the balance if not to the bank the buyer who has the deed. Instant rip off. Run away from this
2007-06-26 18:41:59 · answer #2 · answered by Pengy 7 · 0⤊ 0⤋
It's actually in violation of most mortgage contracts and can trigger the Due on Sale clause in the mortgage. It may also be considered loan fraud in some cases.
What's more, why would someone want to keep the seller's name on the contract and let THEM get credit for THEIR on-time payments??
2007-06-26 18:07:00 · answer #3 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Its called illegal. Unless you have an assumable mortgage, which they have not done in the last 20+ yrs, you cannot do this. When the lender finds out, they will call the loan in in full. Unless its a VA loan, you will not be able to do this. Bad idea
2007-06-26 19:04:36 · answer #4 · answered by frankie b 5 · 0⤊ 0⤋
Who would buy a house and agree to keep the seller's name on the deed? I think by the time you figure out how to do it AND find someone willing to it may be too late.
2007-06-26 18:03:25 · answer #5 · answered by Lainie L 3 · 0⤊ 0⤋
You have heard right ! the mysterious back door is a quit claim deed! it's not always a bad thing but most prefer not to use the method!
Try www. homebuyersincentive .com they claim to buy your house at full value!
2007-06-26 18:08:08 · answer #6 · answered by Anonymous · 0⤊ 1⤋
It's called Land Contract or Contract for deed, depending on what area you are from.
2007-06-26 18:03:41 · answer #7 · answered by Anonymous · 0⤊ 0⤋
It's called a 'silent assumption', and lenders consider it to be lender fraud. The situation is being investigated and may end up with some prosecutions.
2007-06-26 18:04:09 · answer #8 · answered by acermill 7 · 0⤊ 0⤋