Posted on: 02nd Apr, 2011 07:52 am
Found a condo in Sarasota but have not sold my house in Chgo. Owner has agreed to hold the mortgage. Property in Fla., is $500,000. We would put $150/$200 down at 5% interest for 2 possibly 3 years which would give us time to sell our house. Is this a good idea? My husband is apprehensive because he isn't familiar with this type of financing. Please advise.
It is perfectly legitimate but for a transaction this large you should hire an attorney to review all contracts and agreements so that you know it is being done right and the owner will not be able to walk on you - I would also suggest that you arrange to pay any mortgage they have on the place directly so that you know it is being done - once they have your money my biggest concern would be for them to stop making payments and the bank to foreclose - if that happens you will be in a huge mess that you dont want to get into
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Also, when you do a mortgage with a Lender, the condominium property is underwritten by certain guidelines.
If you get a private mortgage, no one is really checking out the condominium as far as what it needs to be eligible for a mortgage.
For example, are more thas 15% of the unit owners over 30 days delinquent paying the monthly condo asociation dues? If they are, you may not be able to get a mortgage even after your house sells in Chicago. There are other condo requirements that must be met to get a mortgage.
If you get a private mortgage, no one is really checking out the condominium as far as what it needs to be eligible for a mortgage.
For example, are more thas 15% of the unit owners over 30 days delinquent paying the monthly condo asociation dues? If they are, you may not be able to get a mortgage even after your house sells in Chicago. There are other condo requirements that must be met to get a mortgage.