Land contract refinance the note
6 Replies
Wilmar Treffers
Investor from Alphen Aan Den Rijn, Zuid-Holland
posted over 3 years ago
Hi, I need some guidance with a refinance question. If I sell a property on a land contract and I want to get cash out of the property. Is it still possible to refinance, let say 70% of the property?
Wilson Lee
from Birmingham, AL
replied over 3 years ago
Do you still hold title? If you do than yea you can. But lenders may not be to eager. The new mortgage would be subordinate to the recorded land contract as the loan is recorded after the land contract.
Try talking to a few loan officers.
Tom Gimer
from Washington, DC
replied over 3 years ago
Not happening.
You don't own the property in the eyes of the law.
Wilmar Treffers
Investor from Alphen Aan Den Rijn, Zuid-Holland
replied over 3 years ago
Thanks for the input. Yes I still hold the title. Hopefully some loan officers see this post and can give some comment on this creative way of financing.
Wilmar Treffers
Investor from Alphen Aan Den Rijn, Zuid-Holland
replied over 3 years ago
Hi Tom, are you 100% sure? I am holding the title. Isn't there a way, lets say I make sure that the loan to the finance is paid for before the land contract ends? Another possibility I am thinking about is to sell the land contract to another investor. I haven't got any experience with this and wonder if there is a market for this. Lest say I have gave a land contract for 100k with 9% interest. The title is still with me. Can I sell this contract, including title to someone for lets say 90k cash? Does anybody know if there is a market for this?
Tom Gimer
from Washington, DC
replied over 3 years ago
The buyer in a land installment contract is the equitable owner of the property.
If the buyer makes the required payments, by law the seller will be required to sign the deed conveying title to him.
Your original email referenced refinancing... to which I replied "not happening." I really should have said "not happening with a traditional lender." Now you're talking about selling the property. This can be done but the terms of the land installment contract would still control.
Wilmar Treffers
Investor from Alphen Aan Den Rijn, Zuid-Holland
replied over 3 years ago
I got it Tom. I brought the selling topic to the table because the finance option is not going to happen ;-) Just exploring the possibilities. Thanks.