Philly Area, PA · Member since 2008 · 297 posts · 27 votes
I'm talking to a lady who would like me to buy her house. I think she is open to owner financing since she needs this to go through.
My question is the house in question has a payoff figure of $109,000. Could I go to a back and get the mortgage for the amount, and have the seller carrying the required 20% down as a second mortgage? Thanks
Rental Property Investor · Mercer Island, WA · Member since 2008 · 22k+ posts · 14k+ votes
14y
Probably not. The bank is going to want to see you have some skin in the game. You would be more likely to get something like a 70% first from a bank, a 15% owner carry and 15% of your own cash into the deal.
If she's open to it, propose just doing a wrap mortgage. She "loans" you $130K as a single owner carried note. You make the payments to her, she pays the existing mortgage and pockets the difference. Or, use a service that you pay into and that then pays the mortgage and sends her the difference. There is some risk, because this does violate the due-on-sale clause in her mortgage.