My husband parents are downsizing and they're going to give us our first rental property. Now his parents still owe $85,000 on their home in Baltimore. I've been listening to Chris Goff I learned about wrap around mortgage, but I'm still very confused about the entire thing. My credit is amazing, and our father isn't requiring us put a dp or anything. If anyone could explain the process to me I would great he's going to sign the contract by the end of the week
To do it the 100% legal way, you might let the bank know that he is giving you the property and you will keep making payments. They may want you to "qualify" for the loan.
You could go to an attorney and do what is called the wraparound mortgage. It just means that they are selling to you for the loan balance. They are still legally responsible for the loan, but you will be paying it. As long you are paying on time, there should not be any problems.
I would not turn around and owner finance the property. Keep it as a rental.
Hey @Rick Pozos I’m still learning the lingo and that’s what we’re going to do keep it as a rental. When you say qualify for the loan what do you mean @Rick
If you ask the bank, they will want to check your credit and qualify you as a purchaser.
if you do a true wrap thats a second loan on the property.. this seems to me to be more of a sub too.
I would talk to @Tom Gimer he runs a title and escrow company there in Balt and is an attorney as well
I think it would be one stop shopping for you.. and a lot better than all the answers from people from different states myself included.
But one document I like and my Dad used as early as the late 70s.. was the CA.. AITD "all inclusive Deed of Trust"
Deed of trust can be substituded for Mortgage.. they are basically the same thing.
but if you can google that doc and read through it .. it will help you understand the mechanics of a Wrap.