Here are some loan programs to help you get started with purchasing a home.
We have lenders that offer these programs.
1. 1st time homes buyers programs.
2 Fha has programs 3 to 3.5 % down
3. conventional 3 % down
4. Rural area loans with as low as a $1000 down.
5. zero money down programs.
6. Then there is owner financing where the seller will sell you a property and finance it themselves. It can be called a few different things-seller financing-Owner financing-Contract for deed-In Wisconsin they call it a land contract.
Sellers usually want 10% down of the sale price of the house to do a cd.
Credit usually doesn’t matter.
We have helped buyers purchase a property with bad credit-low credit scores-high to debt ratios-foreclosures-Bankruptcy-tax liens-child support.
We have all types of properties-condo’s-town homes-Acreage-Hobby Farms-Lake homes-lake shore-deeded access-lots-New construction and much more. All cd terms are different per owner.
We try to work directly with the owner so it saves you on rates and cd terms. Investors will charge you a higher rate on your purchase.
Remember using a knowledgable realtor is very important with owner financing. We work with cd financing on. daily basis and have been in business over over 20 years..
You may browse properties on our site or if you ‘DONT HAVE A REALTOR” Call us we can help you find your dream house.
The buyer agrees to directly pay the seller in monthly installments. The buyer is able to occupy the home after the closing of the sale, but the seller still retains legal title to the property. Actual ownership passes to the buyer only after the final payment is made /refinanced or paid off contract.
As in a standard mortgage, a contract for deed typically has an agreed-upon price and payment schedule. But the payments are often not amortized evenly over a long period, meaning you will likely be required to make a large lump-sum “balloon payment” at a specific date which is usually 3-5 years to complete the purchase by covering the full balance due on the sale price. At that time, you will probably need to get a mortgage for the balloon payment or you may sell the property and keep the equity in the house. I recommend planning a year a head just in case you have something that comes up and you cant refinance it. Talk to the seller and see if they will extend the contract or the buyer may sell the property.
Recording the contract for deed
Within four months of signing the contract for deed, you must “record” it with the office of the county recorder or registrar of titles in the county in which the property is located. If you do not do so, you could face a fine. Recording the contract will also help prove your possession of the property and protect you from post-contract encumbrances placed on the property by the seller.
I recommend using a title company or law office they will record the deed for the buyer also do a title search to make sure the property is free of liens.
Generally the IRS will consider a contract for deed to be a sale, which means the buyer can deduct the interest payments the same as if they had a mortgage payment.
Buyers have the full ownership rights to the property, the buyer is still required to maintain the property, pay taxes.
Benefits of a contract for deed In Minnesota
Easy qualifying –
Quick closing. No delays from the lenders-Mortgage companies
Owners who sell their homes on a CD understand that a buyer is unlikely to have perfect credit and stable income.
Contract for deed payments are structured similar to a mortgage. The buyer pays the Owner their monthly payment the principal amount gradually decreases over time.
No lender fees -Huge savings..
Right to improve the property and build equity
Improve credit so the buyer can get a mortgage and refinance the home. Goto credit karma.com for free credit information
PURCHASE MONEY MORTGAGE
A purchase-money mortgage is a mortgage issued to the borrower by the seller of a home as part of the purchase transaction. Also known a seller or owner financing, this is usually done in situations where the buyer cannot qualify for a mortgage through traditional lending channels. A purchase-money mortgage can be used in situations where the buyer is assuming the seller’s mortgage, and the difference between the balance on the assumed mortgage and the sales price of the property is made up with seller financing.
The purchaser will make a down payment to the seller usually 10% down or more of the sale price of the property, and then make installment payments (usually on a monthly basis) over a specified time, at an agreed-upon interest rate, until the loan is fully repaid. The seller in a transaction offers the buyer a loan rather than the buyer obtaining one from a bank. To a seller, this is an investment in which the return is guaranteed only by the buyer’s credit-worthiness or ability and motivation to pay the mortgage. For a buyer it is often beneficial, because he/she may not be able to obtain a loan from a bank. The loan is secured by the property being sold. In the event that the buyer defaults, the property is repossessed or foreclosed on exactly as it would be by a bank. The time line is shorter than a typical foreclosure. In Minnesota the seller can cancel the contract in 60days if the buyer does not make payments.
There are no universal requirements mandated for seller financing. In order to protect both the buyer’s and seller’s interests, a legally binding purchase agreement should be drawn up with the with boardwalkpremierrealty.com and closed with at a law office or title company.
Unlike a regular mortgage, in which the buyer gets the legal title to the house, the buyer in seller financing does not receive the legal title until they have fully paid off the purchase price of the house. This means that if a buyer misses a payment, they can be evicted and lose all money and interest put into the house.
The buyer is often responsible for repairs, taxes and insurance, meaning that they have the responsibilities of being a homeowner without the rights of actually owning the property. Seller financing contracts are subject to fewer consumer protections than mortgage loans in most states.
- Both the buyer and the seller can make substantial savings in closing costs.
- They can negotiate interest rate, repayment schedule, and other conditions of the loan.
- The buyer can request special conditions for the purchase, such as inclusion of household appliances.
- The borrower does not have to qualify with a loan underwriter.
- There are no PMI insurance premiums unless negotiated.
- The seller can receive a higher yield on his/her investment by receiving equity with interest.
- The seller could negotiate a higher interest rate.
- The seller could negotiate a higher selling price.
- The property could be sold “as is” so there will be no need for repairs.
- The seller could choose which security documents (mortgage, deed of trust, land sales document, etc.) to best secure his/her interest until the loan is paid.
To learn more about our contract for deed programs email us.
Tell us where you want to live?
How much you want to put down?
How soon you want to move.