What would be the best way to sell a home FSBO that has an existing mortgage? Tenant would like to buy house for 75k and the note is around 40k. Unfortunately, tenant does not have enough credit to finance with a bank.
I think the way to do this is a wrap-around mortgage, where the owner holds the tenant's mortgage while paying off his/her own mortgage. This is the kind of thing that you want an experienced attorney writing up so that that everyone is protected. Search BP for wrap-around and you'll find a ton of info as well as people who have done it and are experienced in structuring it.
thanks Patsy. I'll look into it
@Tony Silvas the answer I would give depends on the details. What is the ARV? How much is the seller willing to sell it for? Does the house need some repairs/updates? Is the seller open to selling on terms or do they want to be completely out? What's the PITI? What's the current rent? What's market rent? What is the tenant's FICO score?
There are lots of ways you can make something work but it really depends on the details. Can you share some of this?
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