in addition Another Proven Way on How to Buy a Home For Less
“unprotected to” real estate financing is not new in rel estate but can be a smart way to get into a home for less if one wants to get into a home now with little or no money down.
“unprotected to” deals can truly be a win-win situation for both the seller and the buyer/investor. The seller usually receives his/her character price needs and they no longer pay their mortgage directly. The buyer or investor usually gets the character with very little money down, and does not have to wait for bank financing which may take a month if the buyer can qualify in today’s tight mortgage market. There is nothing wrong with this kind of transaction. I have used it on several occasions myself.
This is a little known way to buy a home. No one else is going to explain it to you because if you use this method you can save thousands and you can buy a house in Georgia without a lot of additional expense. There’s absolutely nothing wrong with this method. While doing it this way one would nevertheless incur the paperwork but, many of the costs that go along with buying a home like the transaction fees that are involved (real estate commissions) are never paid by you or the seller. Other Costs (closing costs, recording fees) are charged to the buyer right away or in some situations never. All transactions are completed in an Attorney’s office and are legal.
The time needed to do a “unprotected to” deal is also reduced quite often. On an average, the whole course of action usually takes up to a month if the house is priced fairly depending on the situation. The time a buyer spends can be just a few hours.
traditional real estate involves working out an agreement that is fair both the seller and the buyer, by using edges and or mortgage companies. By using this kind of financing, the seller may sell their character for the price near what they ask (typically in our area 93 to 96% of asking price), but often not in a timely fact. The seller typically must pay a real estate commission (6 or 7%), and either the buyer or seller gets stuck with the closing costs (typically 3%). Other costs (ordinarily 3% i.e.-home warranty, termite letter, etc) and any fix up cost (like painting and carpet substitute) plus up to six months of carrying cost while the house is on the market (mortgage, elec, water, gas, yard service, assoc fees, trash pickup, insurance, etc.) usually add up to several thousand dollars that the seller usually gets saddled with in a traditional sale.
By leaving out the usual suspects like title companies, real estate agents and loan officers, both parties stand to make the transaction more profitable.
Let’s go over a sample situation which would create an ideal ecosystem for a “unprotected to” agreement.
Here’s what it entails:
1. The current mortgage is held in place for approximately 2 years, at which time the house will be refinanced buy the (new buyer), and owner’s agreed to price of what he needs is (ex.100,000) will be met by the new buyer. In the meantime the current mortgage will be paid by the new buyer every month on time and the new buyer will move into their new home closest.
2. The difference in the asking price and the selling price is $1000.00 the new buyer gives the $1000.00 to the owner and gets a receipt and an agreement is signed.
3. The character is deeded over to the new buyer which by contract ( ATTY Contact) is signed saying the new buyer will pay the current monthly mortgage observe starting now on time every month until the current mortgage is paid off. The contract obligates the buyer to continue making the existing payments or the house deed returns to the owner. The deed will stay in the attorney’s office until the deal is fully contractually completed by the new buyer in approximately 2 years.
4. This relieves the owner of the monthly debt for the mortgage payment so they can move on with their life and new job.
5. The new buyer offers to pay closing costs (saving the owner this expense)
6. After analyzing the deal and realizing that their options and time are running low, the owner agrees with the new buyer and signs over the deed to the new buyer in a document called a land Trust.
7. Now the owner can move on with their live and have no worries about their old house.
8. The new buyer moves in and pays the mortgage each month on the new house.
9. Two years later or sooner, the buyer refinances the home at a great rate and the original mortgage is paid off (freeing the owner from any further obligations while having a perfect mortgage credit history for the time the buyer moved in and paid the monthly mortgage payment). The new buyer now fully owns and has all tax advantages obtainable for home ownership in our great USA. Everybody wins!
Hope this helps,